Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.banks From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: banks Fri, Jul 10 1992 Date: Fri, 10 Jul 92 05:13:31 EDT Message-ID: 07-10 0000 DECISIONLINE: Banking & Economy USA TODAY Update July 10-12, 1992 Source: USA TODAY:Gannett National Information Network BANKS CHOPPING SAVINGS RATES: Banks have taken a meat cleaver to savings rates since the Federal Reserve cut its key discount rate last week. On average, banks chopped rates on certificates of deposit more than a tenth of a percentage point this week, says the newsletter Bank Rate Monitor. That's the steepest one-week drop since early January. The average yield on six-month CDs fell to 3.89% from 4.03%. PASSBOOK SAVINGS RATES DOWN TOO: The drop of the average yield on a six-month certificate of deposit to 3.89% is the first time the average has been below 4% since banks were first allowed to set their own CD rates in 1983. The five-year CD average fell below 6% for the first time, to 5.96% from 6.1%. Other bank rates have fallen to pint-sized levels, too. Passbook savings accounts now pay an average 3.15%. STOCKS RALLY, HALT RECENT SLIDE: The floundering stock market snapped to life Thursday. The Dow Jones industrial average chugged up 30.80 points to 3324.08. "We think the bull market is alive and well," says Don Hays, strategist at Wheat First, Butcher and Singer. Two weeks ago, Hays was predicting a yearlong bear market starting in the fall. Now he is calling for 12 to 15 months of rally and a Dow of up to 4100. JUNE RETAIL SALES SLUGGISH: The nation's major retailers posted yet another month of up-but-not-by-much revenues in June. Retail revenue rose about 3% across the board in June vs. a year earlier, said analyst Tom Tashjian of First Manhattan. He called June a "so-so" month. Most retail watchers, who had been expecting boom spending, now say low single-digit revenue growth is what retailers will see for some time. JOBLESS CLAIMS DIP: The number of new people applying for unemployment benefits fell 4,000 to 416,000 the week ended June 27, the Labor Department says. Economists are encouraged that the number of new claims wasn't higher after last week's report that the unemployment rate soared to 7.8% in June. The four-week average of claims, considered more accurate than the weekly numbers, rose to 415,750 from 414,000. ECONOMISTS SEE SLUGGISH GROWTH: A survey of 52 economists by Blue Chip Economic Indicators newsletter says the economy will grow a sluggish 2.1% this year but won't slip back into recession despite a loss of momentum the second quarter. The economists surveyed early this month revised their consensus estimate of growth in April, May and June to a 2.3% annual rate from 2.8%, reflecting a slowdown late in the quarter. M2 DOWN: A closely-watched measure of the money supply fell $7.2 billion to $3.5 trillion the week of June 29, the Federal Reserve says. Weak growth in the money supply is considered bad for the economy. M2 is cash, checking accounts and money market mutual funds. HOT SAVINGS BONDS: Sales of U.S. Savings Bonds reached $919 million in June, up slightly from May when $916 million in bonds were sold. June sales are 32% higher than the same time last year. Series EE bond held five years or longer are guaranteed to yield at least 6%. GOLD GAINS, SILVER MIXED: Gold prices posted moderate gains Thursday. Silver was mixed. On the Commodity Exchange, gold bullion for current delivery closed at $348.70, up $1.10. Republic National Bank quoted gold at $348.30, up $1.30. Gold also rose overseas. Silver was unchanged in London at $3.91. On the Comex, silver bullion for current delivery settled at $3.926, up 4.3 cents from $3.883. OIL EDGES LOWER: Oil prices fell slightly Thursday as there was little news to affect trades. Light sweet crude for delivery in August settled at $21.40 a barrel, down 1 cent, at the New York Mercantile Exchange. Traders said the absence of market-affecting news or technical factors kept prices in a tight range. Trading volume was light. DOW JONES OPENS ON UPSWING: The Dow Jones average of 30 industrials opens Friday at 3324.08 after closing up 30.80 Thursday. The New York Stock Exchange composite opens at 227.55, up 2.06. The American Stock Exchange market value opens at 381.84, up 1.98. The NASDAQ OTC composite opens at 564.75, up 7.18. DOLLAR OPENS MIXED OVERSEAS: The dollar opens mostly up on Friday. It opens at 0.5275 British pounds, up from 0.5189; 5.1125 French francs, up from 5.0225; 1.5175 German marks, up from 1.4908; and 125.70 Japanese yen, down from 124.66. (As of 3 p.m. Thursday. Source: First American Bank of New York.) 24-HOUR TELEPHONE INFORMATION: USA TODAY Money Hot Line. 95 cents a minute. 1-900-555-5555. Banking & Economy Editor: William Snoddy. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution purposes violates federal law. This article is copyright 1992 Gannett News Service. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM