C Citigroup
- 58.760
- -4.520-7.14%
- 58.650
- -0.110-0.19%
Citigroup News
Zelle payment application faces investigation. JPMorgan is considering suing regulatory institutions.
Zelle is owned by seven major banks, including JPMorgan and Bank of America. Since its launch in 2017, Zelle has grown into a leading peer-to-peer payment network in the USA. Over 100 million consumers can use Zelle through their Bank of America accounts.
Wall Street's big banks all change their tune, JPMorgan and Citigroup expect the Fed to cut interest rates twice by 50 basis points this year.
Given the latest data showing a cooling labor market, expectations of a period of aggressive easing by the Federal Reserve continue to rise on Wall Street. After Friday's data showed a further rise in the U.S. unemployment rate in July, economists at Bank of America, Barclays, Citi, Goldman Sachs and JPMorgan adjusted their rate path forecasts, calling for earlier, larger or more rate cuts. Citi economists expect the Fed to cut rates by 50 basis points at the September and November meetings, and by 25 basis points at the December meeting. Previously, they had expected the Fed to cut rates by 25 basis points at each of these meetings.
Summary of the view: Federal Reserve officials state that they will not overreact to monthly data and major banks expect two 50 basis point interest rate cuts.
Following weaker-than-expected non-farm payrolls data, Chicago Fed President Goolsbee said the Fed wouldn't overreact to single-month data. Major Wall Street banks JP Morgan and Citi have changed their opinions and now expect the Fed to cut rates 50 basis points twice this year. However, observers argue that the Fed won't agree to a 50 basis point cut. Chicago Fed President Austan Goolsbee emphasized that the Fed won't overreact to any single data report and will receive a large amount of economic data before the next meeting.
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Observers refute Wall Street's views and state that the Federal Reserve will not agree to a 50 basis point interest rate cut.
The weak July non-farm payroll report has exacerbated concerns in the market about the Fed's late interest rate cut, but the possibility of a 50 basis point cut in September by policymakers is small, as a massive rate cut might be seen as a warning. The report from the US Bureau of Labor Statistics showed that hiring slowed significantly in July, and the unemployment rate rose to its highest level in nearly three years. Austan Goolsbee, president of the Chicago Fed, said in an interview, "We don't want to overreact to any one month's data." Including jpmorgan and Citigroup, some Wall Street banks have changed their rate forecasts after the non-farm payroll report was released. They are currently expecting a 50 basis point rate cut in September.
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Citigroup expects the Federal Reserve to cut interest rates by 50 basis points in September and November, respectively.
Citigroup economists expect the Federal Reserve to cut interest rates by 50 basis points at the September and November meetings, and by 25 basis points at the December meeting. Previously, they had expected the Fed to cut rates by 25 basis points at each of these three meetings. Based on Friday's July employment data, Veronica Clark and Andrew Hollenhorst predicted that the Fed will cut rates by 25 basis points at each subsequent meeting until mid-2025, lowering the target range for the federal funds rate to 3%-3.25%.
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Citigroup: Cut target price of Hang Seng Bank to HKD 94, maintain neutral rating.
Citigroup's report stated that it lowered Hang Seng Bank's (00011) earnings per share forecast for the fiscal years 2024 to 2026 by 5% to 6%, with an assumption of stock cost rising from 9.8% to 10.1%, resulting in a target price adjustment from HK$106 to HK$94 and maintaining a "neutral" rating. Citigroup stated that Hang Seng Bank's net interest margin was lower than expected in the first half of the year, and therefore lowered its net interest margin forecast for the fiscal years 2024 to 2026 by 3% to 4%. Due to continuous uncertainty in the quality of Hang Seng assets, it decided to increase its provision expense forecast for fiscal year 2025 by 10%.
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