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| MARKETS — FUTURES — as of Sep 24, 6:41 AM ET |
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Thursday, September 24 · Lead The bond market repriced the rest of the year The bond market repriced the rest of the year on Wednesday, and two Federal Reserve officials pointed it that way. New York Fed President John Williams said it is reasonable to expect another increase before year-end; Governor Michael Barr told a Chicago Fed audience that further policy adjustments are likely. The 10-year Treasury yield rose 15 basis points, its largest single-day gain in 17 months, and trades at 5.114 percent pre-market. The 30-year crossed 5.37 percent, on track for its highest settlement since June 2004. Mortgage rates are pushing toward 7.5 percent.
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Sentiment Index
+19
Mildly Favorable
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10-day trend
Sep 24, 6:00 AM ET
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| ▸ | What the curve is now pricing: The Kobeissi Letter puts market odds of an October increase at 64 percent, with the 10-year up roughly 113 basis points from its March low — a move the Letter notes arrived without any single catalyst, unlike the comparable 15-basis-point session in April 2025. Crude sat near $93 a barrel, up about 1 percent pre-market, which keeps the services-and-energy inflation argument alive for the hawks on the Committee. Bitcoin fell about 1.5 percent to $83,193. |
| ▸ | Shelter costs, in the Fed's own numbers: Barr's September 23 speech put the Atlanta Fed's Home Ownership Affordability Monitor at 68 in July 2026, the lowest reading in 21 years, meaning a median-income family cannot afford a median-priced home at current mortgage rates. About half of renters pay 30 percent or more of income on rent, a quarter pay at least half, and between 2000 and 2024 real median household income rose 17 percent while real house prices rose 70 percent. He attributed the price level to a supply shortfall he sized at 2 million to 5.5 million units, citing zoning, permitting and minimum-lot rules. Sixty-eight percent of prospective first-time buyers in 2024 could not afford a down payment. |
| ▸ | The balance-sheet read: The Richmond Fed's survey of corporate finance chiefs, reported by Reuters, now shows rising rates among their top concerns alongside a lifted inflation outlook, while the American Bankers Association's Economic Advisory Committee expects solid growth into 2027 with inflation staying above the 2 percent target on higher oil and services prices. For asset-liability committees, that combination is the hard one: growth that supports loan demand, funding costs that keep climbing, and a securities book whose low-coupon vintages lose more ground with every 15-basis-point session. Deposit betas written for an easing cycle are now two hikes stale. |
REGULATORY DEVELOPMENTS Charter demand keeps arriving from consumer lenders rather than crypto firms, and the OCC's own portfolio data says mortgage credit is holding while affordability deteriorates. | ▸ | Avant's chief executive on why it wants a charter: The Chicago consumer lender's application for a national bank charter, filed last week, got its first explanation on the record: the chief executive told Banking Dive the charter would let it widen its credit products, diversify beyond them, and lower its cost of funds. That last motive is the one to watch in a 5 percent-plus funding environment; a nonbank funding itself in capital markets today has a stronger arithmetic case for deposits than it did in March. Sponsor banks carrying large Avant-style programs should price departure risk into renewal terms. |
| ▸ | Mortgage performance holds at 97.7 percent: The OCC's second-quarter 2026 mortgage metrics report found 97.7 percent of first-lien mortgages in the federal banking system current and performing, unchanged from the first quarter and up from 97.5 percent a year earlier. Read against Barr's affordability numbers, the portfolio data describes borrowers who already own; the stress in the housing market sits with those trying to enter it. The report covers servicers in the federal banking system. |
| ▸ | Ethiopia sanctions authority lapsed: OFAC removed two individuals and four entities from the Specially Designated Nationals list effective September 18, after the national emergency declared in Executive Order 14046 was not continued past September 17. The delisted parties are Abraha Kassa Nemariam, Hagos Ghebrehiwet W Kidan, the Eritrean Defense Forces, Hidri Trust, the People's Front for Democracy and Justice, and Red Sea Trading Corporation. Property blocked solely under that authority is no longer blocked, which makes this an unblocking and account-reactivation exercise rather than a screening one — the operational question is whether any of these parties remain listed under a separate program before services resume. Separately, OFAC designated parties under Executive Order 13902, the Iran authority, effective September 14. |
| ▸ | The bank count in the deposit survey: The FDIC proposed renewing its annual Summary of Deposits collection with no methodological change, but the respondent estimate fell from 11,610 institutions to 10,953. The agency itself says the survey data is used to measure the competitive impact of bank mergers; that arithmetic runs through a denominator that shrank by 657 filers. Comments are due October 26. |
INDUSTRY AND AI SIGNALS | ▸ | Tokenized deposits go national, twice — Canada's six largest banks agreed to work together on tokenized deposits, twelve days after the Canadian bank regulator said a tokenized deposit is not legally distinct from an ordinary one, and UK banks completed their first live customer transactions in tokenized sterling deposits. Both moves take the instrument US banks can issue without waiting on a stablecoin issuer license — a deposit is a deposit, technology notwithstanding — and put it in production abroad first. SoFi's September 22 card-settlement go-live took the other door, issuing its own token. Neither route needs an approval that exists yet. |
| ▸ | Visa's survey prices the trust gap — Stated intent to use stablecoins among US consumers rises from 36 percent to 56 percent when bank-level protections are attached, per a Visa study; the safeguards in the question are hypothetical, which is the finding. Visa and Reap separately extended stablecoin-linked card programs past 100 markets. The deposit-insurance brand is the asset issuers cannot buy. |
| ▸ | Washington weighs a dollar-token export policy — The administration is considering an initiative to promote dollar-backed stablecoins abroad as a source of Treasury demand, Bloomberg reported, with CoinDesk carrying the account. A White House crypto adviser said Wednesday that the CLARITY Act's failure leaves the CFTC without spot-market authority, which caps what the agencies can build without a statute. Reserve managers and correspondent desks own the read. |
| ▸ | A diesel export ban under consideration — President Trump is preparing a 90-day ban on US diesel exports to bring down record pump prices, Politico reported and the Kobeissi Letter relayed; any halt would be the first such restriction since 2015. Refiner, trucking and agricultural borrowers sit on both sides of that trade. Nothing has issued. |
| ▸ | Bank of America doubles its AI budget — The bank's co-president said Wednesday it plans to double AI spending next year, pointing to gains he called clearly identifiable. The governance question examiners will ask is not capability but delegation: what limits an agent operates under, who intervenes, and who owns an error. Write those limits before the budget lands. |
| ▸ | M&A in the Southwest — WestStar Bank of El Paso agreed to acquire Albuquerque's Southwest Capital Bank, adding six New Mexico branches. |
POLITICAL & LEGISLATIVE | ▸ | Justice argues the NCUA is not the Fed: The Department of Justice told an appeals court that the reinstatement of two removed National Credit Union Administration board members should be reversed, on the theory that the statute does not explicitly bar the President from removing them. That is the same removal argument that reaches FDIC board members; after Trump v. Cook, it stops at the Federal Reserve's for-cause wall and nowhere else in the prudential stack. Credit unions and state regulators watching the NCUA's rulemaking posture have a quorum question sitting under it. The case is on appeal. |
| ▸ | A Senate bill on asset thresholds: A proposed Senate bill would raise the asset-based regulatory thresholds that determine which rules bind which banks, and would set a process for updating them periodically. Thresholds fixed in nominal dollars tighten every year through growth alone; an indexing mechanism is the provision community and mid-size banks should read first. It remains a bill, not law. |
WHAT'S COMING | ▸ | The Federal Reserve's proposal on regulatory modernization and relief for mutual holding companies closes to comment October 5. Mutual institutions weighing a reorganization have eleven days to put structural friction they actually encounter into a docket the final rule will be built from. |
| ▸ | The OCC's window on how it classifies violations of laws or regulations closes October 1, alongside the FDIC's reciprocal-deposit window under the 21st Century ROAD to Housing Act. Community banks funding large balances through reciprocal networks should file post-hike deposit arithmetic, not spring's. |
| ▸ | An FDIC information collection notice and a Federal Reserve change-in-bank-control notice are filed for publication today; the control notice is where new acquirer filings first become public. |
WHAT IT MEANS | ▸ | Wednesday's repricing lands on the reciprocal-deposit docket that closes October 1. The funding assumptions most 2026 plans carry were written when the market expected cuts; the 10-year at 5.114 percent, with roughly two-thirds odds on an October increase, makes reciprocal and brokered balances more expensive, not less, across the comment period and the rule that follows. Banks filing on the FDIC's reciprocal-deposit proposal have one week to describe that cost with current numbers rather than the ones in their spring board packages — the agency will build the final rule off what the record says the funding actually costs. The same arithmetic belongs in the securities-portfolio review before quarter-end, because the duration decision and the funding decision are now the same decision. Comments close October 1. |
Dates That Matter SEP 25
1d | Comments close: Swap Execution Facility Order Book Requirement for Permitted Transactions [CFTC] | SEP 25
1d | Watch: comments due on the OCC information collection for PPSI licensing applications [Watch] | SEP 28
4d | Watch: Supreme Court conference on Nos. 25-1313, 25-1350, 25-1004; order list expected Oct 5, 2026 [Watch] | OCT 1
7d | Comments close: Violations of Laws or Regulations [OCC] · Reciprocal Deposits: Implementing the 21st Century ROAD to Housing Act [FDIC] · Privacy Act Regulations [CFTC] · Special measure: Banque Misr UAE [FinCEN] | OCT 1
7d | Effective: Telemarketing Sales Rule Fees [FTC] |
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30-Day Document Volume
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Today's inputs
| 66 docs | 20 high priority | 40 social | 305 news |
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Monitoring 93+ sources across federal agencies, state regulators, expert newsletters, social media, and news wires · Methodology |
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Signed
Lex
LexRegPulse Analyst · Methodology
Primary-source research · AI-drafted · human-reviewed
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