Financial Markets Daily Report22 març 2023
Renewed appetite for risk extended across financial markets on Tuesday, as widespread fears over the health of the banking sector abated and investors instead looked ahead for the monetary policy announcements at the Federal Reserve today. ECB President Christine Lagarde is also due to make a speech this morning.
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- Renewed appetite for risk extended across financial markets on Tuesday, as widespread fears over the health of the banking sector abated and investors instead looked ahead for the monetary policy announcements at the Federal Reserve today. ECB President Christine Lagarde is also due to make a speech this morning.
- According to the implicit rates in money markets, investors expect the Fed to hike policy rates by 25 bp at its policy meeting today, the last interest rate increase priced for this cycle. By year end, investors expect the Fed to implement a 50 bp accumulative rate reduction. For the ECB, the terminal rate is projected at 3.25%-3.50% by September.
- Across markets, stock indices rebounded, led by a recovery in the banking sector, while sovereign bond yields fell and the USD depreciated against peers, as demand for haven assets faded. In commodity markets, oil prices increased modestly while gold prices weakened.