News In Brief
New York — Major banks in US boost prime rate by half a point
Major US banks raised their prime lending rate Monday by half a point to 13 percent. That was its highest level since October 1982. Economists said the prime was likely to rise even further unless other interest rates and business loan demand fell sharply.
The move, the fourth rise in four months, was led by First National Bank of Chicago, the nation's eighth-largest bank, and quickly followed by No. 2 Citibank and No. 6 Chemical Bank, both in New York.
Many Wall Street analysts had anticipated the increase because the economy, while showing signs of slowing down, remains robust and has brought on a heavy credit demand from the private sector.