Assessing the banking turmoil: Is the market panic an overreaction or justified? Artwork

FX Talk - an Ebury podcast

The euro goes up, the dollar goes down, and China devalues the yuan. But what's behind these currency fluctuations? This forex podcast is all about the global currency market. Our three financial market analysts, who are also top Bloomberg forecasters, discuss macro-economic news and its effect on the global financial market - providing you with insights to make informed decisions. *The information contained in this podcast does not constitute a recommendation from any Ebury entity to the recipient.

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FX Talk - an Ebury podcast

Assessing the banking turmoil: Is the market panic an overreaction or justified?

March 30, 2023 • Ebury FX Talk • Season 4 • Episode 12

In this episode, we discuss the recent banking turmoil, specifically the failure of SVB and its impact on the market. SVB's sensitivity to interest rate risk and its investment in long-duration bonds led to a significant mark-to-market hole in its balance sheet, causing depositors and investors to withdraw their funds en masse. This panic has contributed to the troubles faced by Credit Suisse, but we believe these failures are one-offs rather than systemic issues. While the market has stabilized, we must closely monitor the situation. In terms of central bank rate hikes, there is a delicate balancing act between banking uncertainty and inflation. Markets are only pricing in one more 25bp move from the Fed, but we believe the ECB and BoE still have room to go.

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We’d like to hear from you! Provide us with feedback so we can improve the podcast: https://linktr.ee/fxtalk

Liked this show? Please leave us a review here – even one sentence helps!