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The dangers of U.S. banks holding large amounts of uninsured deposits came up repeatedly in his testimony. For example, Gruenberg’s written testimony included these details about the ongoing banking crisis:..
German savers are getting cold feet about deposits held abroad despite juicier interest rates for fear of getting embroiled in a crisis like the one that hit Silicon Valley Bank, data compiled for Reuters shows.
Banks are a bellwether for the economy. It’s worth looking past today’s headlines and asking, “What else is on a bank’s balance sheet that could cause trouble?”
It’s the U.S., Not Europe’s Banking System That’s a Concern, Top Economists SayMar 31, 2023 - 07:06:09 PDT
"We're still fighting inflation, but, at the same time, we're fighting these uncertainties in the banking sector. All of the central banks will try to distinguish between the two and say, on the one hand, we can use certain policies to deal with the financial instability. On the other hand, we can use interest rates to fight inflation. But those two will get muddied, and I think, inevitably, financial instability will become the one that's dominant."
“Old soldiers never die,” said Gen. Douglas MacArthur in his long-ago farewell address of April 1951. “They just fade away,” he added with a note of deep sadness. I sure wish we could say that about Keynesian economists.
Gold prices held steady on Friday, but the safe-haven metal was bound for its second straight quarterly gain after recent banking turmoil raised hopes of a less-aggressive U.S. Federal Reserve and shored up interest in bullion.
The Fed's favorite inflation indicator - Core PCE Deflator - was expected to remain 'sticky' at 4.7% (but instead it came in modestly lower at 4.6% YoY - lowest since Oct 2021). Headline PCE fell to 5.00% - lowest since Sept 2021...
In a quick succession this week, Beijing unveiled ground-breaking deals to further its efforts to promote the yuan and ditch the US dollar. It’s the kind of thing money-market guru Zoltan Pozsar had in mind when he warned that the dollar’s centrality in the world financial system is slowly being whittled away.
Mar 31, 2023 - 05:48:55 PDT
A meeting between ASEAN Finance Ministers and Central Bank Governors discussed the move to settle financial transactions and settlements in local currencies.
Investors moved $508 billion into cash in the first quarter of this year, the largest quarterly inflow since the market turmoil early in the COVID-19 pandemic, according to BofA Global Research, as the failure of several banks sent markets spinning. Flows into cash of $60.1 billion in the week to Wednesday were down from $142.9 billion the previous week, but the quarterly dash for cash...
Slower China Factory Activity Growth Challenges Economic Recovery ProspectsMar 31, 2023 - 05:44:51 PDT
China's manufacturing activity expanded at a slower pace in March, official data showed on Friday, raising doubts about the strength of a post-COVID factory recovery amid weaker global demand and a property market downturn.
Global mergers and acquisitions (M&A) activity shrank to its lowest level in more than a decade in the first quarter of 2023, as rising interest rates, high inflation and fears of a recession soured the appetite of companies for dealmaking.
The Bank of Japan (BOJ) on Friday raised the maximum size of its planned Japanese government bond (JGB) purchases for all maturities over the next three months, doubling down on efforts to defend its ultra-loose policy. The BOJ said it would offer to buy between 475 billion yen and 875 billion yen ($3.57 billion-$6.57 billion) of 5-year to 10-year bonds, raising the top end of the range...
The International Monetary Fund is calling on its wealthier member nations to contribute to a trust for the poorest countries that is short billions of dollars at a time of rising demand from economies in debt distress.
Banks reduced their borrowings from two Federal Reserve backstop lending facilities in the most recent week, a sign that liquidity demand may be stabilizing.
Federal Reserve officials continued to stress the need to lower inflation even as they keep an eye on the fallout from the collapse of Silicon Valley Bank earlier this month.
The International Monetary Fund said the Bank of Japan should avoid a premature exit from monetary easing and outline conditions for raising its negative interest rate in order to improve its communication.
Underlying inflation in the euro area hit a record in March, handing ammunition to European Central Bank officials who say interest-rate increases aren’t over yet.
Investors are seeking protection for inflation that’s poised to stay higher for longer because they expect the Federal Reserve will abandon its fight for price stability prematurely to support the financial sector.
Global credit investors are jumping back into bank bonds following a sector-wide rout — though concerns about additional tier 1 debt remain.