Moderate growth, earnings challenges likely in 2024
The U.S. economy will experience moderate growth in 2024 while avoiding recessions, America’s Credit Unions’ economists forecast in the January Economic Update. America’s Credit Unions’ Curt Long and Mike Schenk examine the organization’s latest economic forecast in the video.
Liquidity, loan performance cost of funds, and operating expenses will combine to make a challenging year for earnings, Long and Schenk note.
“We expect credit unions to face a challenging earnings environment in 2024. Cost of funds is rising rapidly, which is weighing on net interest margins,” the economic forecast reads. “Loan delinquencies are also climbing, particularly the credit card and auto segments. While member demand for loans will likely rise this year, those credit unions with tighter liquidity will not be able to take advantage.”
Among the headwinds and tailwinds facing the economy in 2024:
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