Markets calmer today after Bank Sector turmoil

Bank sector woes continued last week increasing concerns about the stability of the US economy. Many investors now think the Fed may be forced to pause its current cycle of rate increases in response. We’ll find out on Wednesday.

Following the collapse of Silicon Valley Bank in the US, which prompted a sell-off in risk-assets, stocks rebounded after US CPI data on Tuesday showed the annual inflation Rate fell to 6% in February. This provided some relief although core inflation was reported higher than forecasted.

News came on Wednesday that Credit Suisse was also having problems and yesterday (Sunday) UBS was persuaded by regulators to buy its rival in an emergency deal with the hope that confidence could be restored. Today (Monday) markets are a bit calmer – equities are holding steady, the US 10-yr Treasury Yield is slightly higher and the Dollar down a little.

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