PLANO, Texas — With the economy expected to experience "modest growth" in the second half of the year, credit unions' asset yield should hold during that time.
That's according to Brian Turner, manager of Southwest Corporate Credit Union's Investment Advisory Service. Growth will average between 2.4% to 2.6% for the remainder of 2007, while core inflation will remain somewhat elevated at 2.2% to 2.3%, Turner said.
As expected, the Federal Reserve kept the benchmark target interest rate at 5.25% and reiterated its stance that inflation is the "predominant" risk facing the economy, Turner noted. The late June announcement marked the eighth consecutive meeting, which the FOMC has kept the overnight rate at 5.25% and comes one year since their last increase of 25 basis points. The Federal Reserve's current monetary policy is seeking to provide incentives to stimulate long-term economic growth at a stable pace as to keep inflation in check, Turner said.
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