BANKING & FINANCE - July 12, 1994

Ex-Fed Governor Says Further Rate Hikes Needed: Wayne Angell, now chief economist at Bear, Stearns & Co., said that to avoid a recession in the next three years, the Federal Reserve Board needs to raise the federal funds rate--the interest rate that banks charge one another for overnight loans--by 100 basis points, to 5.25%. The Fed has raised the rate 25 basis points four times this year. Many analysts expect to see rates rise again, perhaps as much as 50 basis points, before the policy-making Federal Open Market Committee convenes again Aug. 16.