Economy
Federal Student Loan Repayments Resume, Potentially Affecting Credit Scores
After a four-year hiatus, federal student loan repayments are resuming, placing financial pressure on borrowers due to additional debt accrued during the pause, according to Liz Pagel of TransUnion (NYSE:). The reintroduction of these payments is likely to increase borrowers’ monthly obligations. TransUnion, with a market capitalization of 13.33 billion USD, has been closely monitoring the situation. Their revenue growth of 10.17% in the last twelve months, according to InvestingPro data, reflects their ability to adapt to market changes.
The Biden administration has implemented an “on-ramp” period to shield credit scores, reporting any missed payments as forbearances until September 2024. Rikard Bandebo from VantageScore sees potential benefits for those commencing repayments during this period. TransUnion’s P/E Ratio stands at 57.5, which indicates a high earnings multiple as per InvestingPro Tips, a potential sign of investor confidence in the company’s future earnings.
However, FICO scores may be slightly impacted by the accruing interest as they are influenced by payment history and total debt. Any improperly recorded missed payments can be disputed by borrowers. TransUnion’s impressive gross profit margin of 65.29% in the last twelve months, as reported by InvestingPro, points to the company’s efficiency in its operations.
To provide relief, income-driven repayment plans and the new SAVE program have been introduced. Despite these measures, delinquencies post-“on-ramp” period could significantly lower credit scores. As per InvestingPro Tips, TransUnion’s strong earnings should allow management to continue dividend payments, a factor that may appeal to investors.
For monitoring purposes, free credit reports are available to borrowers. It is crucial for borrowers to stay informed and proactive in managing their debts during this transition period. TransUnion’s net income is expected to grow this year, according to InvestingPro Tips, which could further solidify its position in the market. For more insights into TransUnion and other companies, consider exploring InvestingPro, which offers real-time metrics and additional tips.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.
© Reuters. Russian Central Bank Governor Elvira Nabiullina attends a news conference in Moscow, Russia June 14, 2019. REUTERS/Shamil Zhumatov/File Photo
MOSCOW (Reuters) – Russia’s central bank will need two to three months to make sure that inflation is steadily declining before taking any decision on interest rate cuts, the bank’s governor Elvira Nabiullina told RBC media on Sunday.
The central bank raised its key interest rate by 100 basis points to 16% earlier in December, hiking for the fifth consecutive meeting in response to stubborn inflation, and suggested that its tightening cycle was nearly over.
Nabiullina said it was not yet clear when exactly the regulator would start cutting rates, however.
“We really need to make sure that inflation is steadily decreasing, that these are not one-off factors that can affect the rate of price growth in a particular month,” she said.
Nabiullina said the bank was taking into account a wide range of indicators but primarily those that “characterize the stability of inflation”.
“This will take two or three months or more – it depends on how much the wide range of indicators that characterize sustainable inflation declines,” she said.
The bank will next convene to set its benchmark rate on Feb. 16.
The governor also said the bank should have started monetary policy tightening earlier than in July, when it embarked on the rate-hiking cycle.
© Reuters. FILE PHOTO: Workers walk past an under-construction area with completed office towers in the background, in Shenzhen’s Qianhai new district, Guangdong province, China August 25, 2023. REUTERS/David Kirton/File Photo
SHANGHAI (Reuters) – China’s top planning body said on Saturday it had identified a second batch of public investment projects, including flood control and disaster relief programmes, under a bond issuance and investment plan announced in October to boost the economy.
With the latest tranche, China has now earmarked more than 800 billion yuan of its 1 trillion yuan ($140 billion) in additional government bond issuance in the fourth quarter, as it focuses on fiscal steps to shore up the flagging economy.
The National Development and Reform Commission (NDRC) said in a statement on Saturday it had identified 9,600 projects with planned investment of more than 560 billion yuan.
China’s economy, the world’s second largest, is struggling to regain its footing post-COVID-19 as policymakers grapple with tepid consumer demand, weak exports, falling foreign investment and a deepening real estate crisis.
The 1 trillion yuan in additional bond issuance will widen China’s 2023 budget deficit ratio to around 3.8 percent from 3 percent, the state-run Xinhua news agency has said.
“Construction of the projects will improve China’s flood control system, emergency response mechanism and disaster relief capabilities, and better protect people’s lives and property, so it is very significant,” the NDRC said.
The agency said it will coordinate with other government bodies to make sure that funds are allocated speedily for investment and that high standards of quality are maintained in project construction.
($1 = 7.1315 renminbi)
© Reuters. Russian Central Bank Governor Elvira Nabiullina attends a news conference in Moscow, Russia June 14, 2019. REUTERS/Shamil Zhumatov/File Photo
MOSCOW (Reuters) – Russia’s central bank will need two to three months to make sure that inflation is steadily declining before taking any decision on interest rate cuts, the bank’s governor Elvira Nabiullina told RBC media on Sunday.
The central bank raised its key interest rate by 100 basis points to 16% earlier in December, hiking for the fifth consecutive meeting in response to stubborn inflation, and suggested that its tightening cycle was nearly over.
Nabiullina said it was not yet clear when exactly the regulator would start cutting rates, however.
“We really need to make sure that inflation is steadily decreasing, that these are not one-off factors that can affect the rate of price growth in a particular month,” she said.
Nabiullina said the bank was taking into account a wide range of indicators but primarily those that “characterize the stability of inflation”.
“This will take two or three months or more – it depends on how much the wide range of indicators that characterize sustainable inflation declines,” she said.
The bank will next convene to set its benchmark rate on Feb. 16.
The governor also said the bank should have started monetary policy tightening earlier than in July, when it embarked on the rate-hiking cycle.
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