Why Banks Are Going to Have to Boost ‘Deposit Beta’
Published on: Thursday 13 July 2023
As the US Federal Reserve has raised interest rates at the fastest pace in decades, savers have been expecting to see those increases appear via higher yields on their bank accounts. Money-market mutual funds have been more generous than the banking sector in raising the rates paid on savings, however. This disparity, which has become more pronounced in the wake of regional bank turmoil earlier this year, involves what’s known as deposit beta.