NEW YORK (BankingMyWay) -- The Federal Reserve has released the minutes of its October meeting on discount rate policy, showing it has once again decided to keep rates right where they are -- and that could mean trouble, eventually, for retail banking consumers.
The problem? A continued low interest rate policy from the Federal Reserve continues to drain bank profits, so much so that banks may decide to charge retail customers for their deposits.
Nothing is etched in stone, but the rumblings have already started among larger banks.
At the meeting, board members opted to keep interest rates at current levels (between zero and 0.25%), and some members are wondering openly what a sustained low rate policy will mean to banks bottom lines.said the Fed policy and its "cheap loans" and subsequent low profit margins, has led to banks such as JPMorgan Chase and Bank of America looking to "compensate" for those lower revenues. deposits unless the Fed backed off on its low rate policy and began hiking interest rates. Theres no word on what those premium charges will be or if theyll happen at all. But heading into 2014, bank customers cant be blamed for waiting for the other shoe to drop -- if big banks dont get their way from the Federal Reserve.
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