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March: Going Out like A Lamb after Wrestling with a Lion

March 31, 2023
Overview: The banking stress that roiled the markets this month has eased. However, the emergency lending by the Federal Reserve, vias the discount window and new Bank Term Funding Program hardly slowed in the past week ($152.6 bln vs. $163.9 bln). Money markets took in more funds. Almost $305 bln has flowed to them over the past three weeks. The …
March: Going Out like A Lamb after Wrestling with a Lion March: Going Out like A Lamb after Wrestling with a Lion Reviewed by Marc Chandler on March 31, 2023 Rating: 5
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Thumbnail Sketch of the Peso Ahead of Banxico's Decision

March 30, 2023
The central bank of Mexico is expected to deliver a 25 bp rate hike later today that would lift the overnight cash target to 11.25%. The swaps market says this will be the last hike in the cycle. However, with a further hike by the Fed possible, it seems unlikely that Banxico will declare mission accomplished. Still, Mexico’s overnight rate is abo…
Thumbnail Sketch of the Peso Ahead of Banxico's Decision Thumbnail Sketch of the Peso Ahead of Banxico's Decision Reviewed by Marc Chandler on March 30, 2023 Rating: 5
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Dollar Soft but Stretched

March 30, 2023
Overview: While bank stress seems to continue to ease, the dollar languishes against most of the major currencies. The Japanese yen is the notable exception. It is off about 1.5% this week. The Dollar Index has given back the gains scored at the end of last week but remains inside the range set last Thursday and Friday (~101.90-102.35). Perhaps th…
Dollar Soft but Stretched Dollar Soft but Stretched Reviewed by Marc Chandler on March 30, 2023 Rating: 5
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Financial Stress Continues to Recede

March 29, 2023
Overview: Financial stress continues to recede. The Topix bank index is up for the second consecutive session and the Stoxx 600 bank index is recovering for the third session. The AT1 ETF is trying to snap a four-day decline. The KBW US bank index rose for the third consecutive session yesterday. More broadly equity markets are rallying. The advan…
Financial Stress Continues to Recede Financial Stress Continues to Recede Reviewed by Marc Chandler on March 29, 2023 Rating: 5
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Firmer Rates and Higher Bank Stocks Give the Greenback Little Help

March 28, 2023
Overview: Financial strains eased yesterday, and short-term yields jumped. The two-year US yield jumped 25 bp to pierce 4%. Yet, the dollar fell against most of the major currencies yesterday and is mostly softer today. Banking stress is ebbing. The Topix bank index snapped a three-day decline and jumped nearly 2% today to recoup the lion's sh…
Firmer Rates and Higher Bank Stocks Give the Greenback Little Help Firmer Rates and Higher Bank Stocks Give the Greenback Little Help Reviewed by Marc Chandler on March 28, 2023 Rating: 5
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Calmer Markets to Start the New Week

March 27, 2023
Overview: There did not appear to be any negative surprises over the weekend, and this is helping calm investors' nerves at the start of the new week. Deutsche Bank shares have recovered most of the pre-weekend loss in the German market, and Stoxx bank index is posting a gain for the first time in four sessions. The AT1 ETF is slightly softer.…
Calmer Markets to Start the New Week Calmer Markets to Start the New Week Reviewed by Marc Chandler on March 27, 2023 Rating: 5
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Banking Crisis Roils Capital Markets, Overshadowing High-Frequency Data

March 25, 2023
The banking crisis is the newest shock to roil the capital markets. Pragmatic action by central banks, governments, and the private sector has thus far been insufficient to allow investors to be confident that the problem is ring-fenced. Credit Suisse was a pre-existing problem that flared up to the breaking point. The government's offer to ta…
Banking Crisis Roils Capital Markets, Overshadowing High-Frequency Data Banking Crisis Roils Capital Markets, Overshadowing High-Frequency Data Reviewed by Marc Chandler on March 25, 2023 Rating: 5
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The Dollar Jumps Back

March 24, 2023
Overview: The pendulum of market expectations has swung dramatically and now looks for 100 bp cut in the Fed funds target this year. That seems extreme. At the same time, the dollar's downside momentum has stalled, suggesting that the dollar may recover some of the ground lost recently as the interest rate leg was knocked out from beneath it. …
The Dollar Jumps Back The Dollar Jumps Back Reviewed by Marc Chandler on March 24, 2023 Rating: 5
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