Rate cuts can be a double-edged sword for banks. While lower interest rates may boost borrowing and stimulate economic activity, they can also squeeze profit margins on loans. Balancing growth and profitability becomes a delicate dance in a shifting financial landscape.
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Is rate cut good for banks
As central banks consider rate cuts, the impact on financial institutions becomes a double-edged sword. Lower rates can stimulate borrowing, boosting loan demand, yet they may squeeze profit margins on interest income. Balancing growth and profitability is key.