The Wall Street Journal writes "Goldman Sachs, Ally Financial Beat the Fed to a Rate Cut." The article tells us, "Goldman Sachs Group Inc. and Ally Financial Inc. aren't waiting around for the Federal Reserve to cut interest rates. Goldman told customers Thursday it was cutting the rate on its Marcus high-yield savings account to 2.15% from 2.25%, following Ally's decision to lower its online-savings rate to 2.1% from 2.2%. The cuts show that banks are positioning themselves for the Fed to lower rates later this year." Ally comments, "Interest rates are on the downswing and projected to fall further." The Journal piece continues, "Goldman didn't offer customers an explanation but suggested they explore its high-yield certificates of deposits. Goldman said in a statement that 'rates on certain products change based on market conditions.' The central bank began raising rates from near zero starting in 2015 at a pace that allowed banks to charge borrowers more while keeping deposit costs in check. That gave Goldman, Ally and other online-only banks an opening to lure savers with above-market yields." But it adds, "The Fed's decision to pause rate increases earlier this year took the pressure off banks to pay depositors more, and the possibility of a cut is giving them cover to go down. For every 10 basis points -- 0.1 percentage point -- that Ally lowers its savings rate, the company boosts its earnings by 3%, said Vincent Caintic, managing director for Stephens Inc.... Ally and Goldman are still paying savers well above the rest of the industry. The average interest rate on a savings account has stayed steady at 0.1% in 2019, according to Bankrate."

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