Consumers and businesses are likely to get a break in the fight against inflation with the first cut in interest rates expected in September, says Huntington Bancshares' top executive .
Forecasting rate cuts after that though gets a little more murky, Steve Steinour , the bank's president, chairman and CEO, said recently after the the bank released its financial results for its second quarter.
"Our best estimate is September," he said for the first rate cut. "Obviously, it's data dependent. You could have a bad number and that could push it off.
"You have to be careful. You can't let inflation recur."
The bank's forecast is inline with others that predict a quarter-point cut in September, but while other forecasts show more rate cuts later in the year, Steinour isn't so sure.
Lower interest rates could make it easier for consumers, for example, to buy a home or help businesses to borrow money to expand.
The Federal Reserve was on an aggressive rate-hiking schedule in the fight to bring down the highest rate of inflation in four decades.
There are uncertainties around the presidential election and potential policies that could mean additional economic stimulus that could jeopardize future rate cuts, he said.
![https://img.particlenews.com/image.php?url=4DCE78_0uf7Fr5u00](https://img.particlenews.com/image.php?type=thumbnail_580x000&url=4DCE78_0uf7Fr5u00)
"We’ll get through this election season and have a better view," he said.
Huntington reported profit of $474 million, 30 cents per share for the April 1-June 30 quarter, 2 cents ahead of Wall Street estimates.
Profit increased $55 million, or 4 cents per share from the first three months of the year, but fell $85 million, or 5 cents per share, from the same period in 2023 as banks were continuing to adjust to the full effect of the Federal Reserve's campaign to raise interest rates.
The bank reported more loans, deposits and fee income during the quarter, and Steinour said customers were managing through higher interest rates, political uncertainty and a slowing economy. While unemployment rates are rising, they still remain low historically.
"Inflation is cooling and likely to continue to cool,’’ he said, helped by demand becoming more normal after being so distorted during the pandemic.
"This all round was a good quarter," he said. "We've been able to help many customers meet a more challenging environment with interest rates up."
Steinour acknowledged some problems with commercial real estate, especially in downtowns where workers have been slow to return.
"But most of our customers are looking for labor," Steinour said. "Ongoing demand for good people, that bodes well for the future, and does not suggest a drop off."
mawilliams@dispatch.com
@BizMarkWilliams
This article originally appeared on The Columbus Dispatch: Lower interest rates coming, but maybe not as much as expected says Huntington CEO
Comments / 0