“If interest rates stay higher for longer, we will have to monitor deposit mix trends to see if there is any impact on noninterest-bearing deposits, which could put some pressure on net interest income, excluding Markets.”

In context

“e also grown deposits, and as we said when we provided our outlook last quarter, much of the growth was from interest-bearing deposits, particularly in our commercial businesses. As a reminder, when the asset cap was in place, these deposits were limited, and now that it has been lifted, we are successfully growing these deposits. While they are higher cost, they are important to our strategy of deepening relationships with our clients. We expect this trend to continue throughout the year. We have also successfully grown interest-bearing deposits in our consumer businesses, while we are enhancing marketing and increasing activity in the branches to drive stronger, low-cost checking account growth. Balances in these accounts are smaller than commercial balances and can take longer to grow. If interest rates stay higher for longer, we will have to monitor deposit mix trends to see if there is any impact on noninterest-bearing deposits, which could put some pressure on net interest income, excluding Markets. In terms of interest rates, our outlook assumed two to three cuts by the Federal Reserve. The market currently expects fewer cuts, which, all else being equal, is positive for NII excluding Markets. However, interest rate expectations are constantly changing. The rate cuts we assumed were expected to occur later in the year, so if we get fewer cuts, it would be beneficial but would only have a modest impact on this year's net interest expectations. Also, longer-term rates are currently a little above the expectations at the beginning of the year but have been volatile year to date, so that could be a small positive if rates remain elevated. In terms of Markets NII, as we all know, it is always hard to forecast but even harder in a dynamic macroeconomic environment like the one we are in n”