New weekly US deposit figures have come out showing that Americans are now increasing the amount of cash they hold in the traditional banking system.
Depositors deposited a total of $86.58 billion over the past week, according to new figures from the Federal Reserve Economic Data (FRED) system.
That’s a notable change from the previous week, when depositors withdrew around $30 billion from their bank accounts.
US banks now have total deposits of $17.23 trillion compared to $18.10 trillion a year ago.
A new report from the Federal Deposit Insurance Corporation (FDIC) shows that Americans withdrew $472 billion in the first quarter of 2023.
Most of the money came from uninsured deposits as customers reduced the risk of holding more than $250,000 per depositor, per insured bank, and for each category of account holder.
Money market funds are the recipients of much of the money that leaves the banking system as investors seek safety and yield.
According to Crane data, assets held by money market funds increased to $5.6 trillion at the end of the first quarter. That’s the highest number since records began.
On Wednesday, JPMorgan CEO Jamie Dimon offered an upbeat outlook on US banks overall.
Compared to the 2008 financial crisis, according to Dimon, this time there is “nothing like this leverage” in the system.
Dimon says he believes the banking system is healthy, although “some banks” are “offside” because of exposure to sharp hikes in interest rates.
“Private companies are actually in very good shape. The banking system is in pretty good shape.
You saw that regional banks are reporting very good numbers right now. The deposits are not used up, as people say.”
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