Charles Schwab's (NYSE: SCHW) stock has been under pressure for over a year. Weighing on the business are interest rates that have reached their highest levels in decades, which had Schwab customers moving funds out of their accounts. Schwab's deposit trends have been at the forefront of investors' minds, and its recent earnings gave investors some reason for optimism. Here's why.

Charles Schwab has historically provided solid results for investors thanks to its limited credit exposure and cost efficiency, which drive stellar margins. However, the financial services company has faced significant headwinds over the last couple of years due to the rapid increase in interest rates.

In 2022, inflation (as measured in the year-over-year change in the Consumer Price Index) reached its highest level in four decades. The Federal Reserve's job is to ensure price stability, and it aims to keep the general level of inflation around 2%. To put a damper on rising costs, the Federal Reserve raised its benchmark interest rate from near zero in March 2022 to an upper limit of 5.5%.

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Source Fool.com