A cut in the prime rate hints latest peak is past
New York — Chase Manhattan Bank cut its prime lending rate half a percentage point, to 20 percent, the first major indication that interest rates may have passed another peak. Other major banks were expected to follow.
The prime rate, which banks charge their most creditworthy corporate customers, peaked last December at 21 1/2 percent. If fell to 17 percent in April before climbing back up under pressures from heavy loan demand and the Federal Reserve's tight-money policy, caused by large inscreases in the money supply.