{"id":58680,"date":"2023-03-27T11:44:54","date_gmt":"2023-03-27T08:44:54","guid":{"rendered":"https:\/\/ironfx-com-php8.wp-dev.int.theitops.net\/?p=58680"},"modified":"2025-10-13T13:23:36","modified_gmt":"2025-10-13T10:23:36","slug":"deutsche-bank-exasperates-fear-of-a-contagion-was-credit-suisse-and-snb-the-beginning","status":"publish","type":"post","link":"https:\/\/www.ironfx-id.com\/th\/deutsche-bank-exasperates-fear-of-a-contagion-was-credit-suisse-and-snb-the-beginning\/","title":{"rendered":"Deutsche bank exasperates fear of a contagion, was Credit Suisse and SNB the beginning?"},"content":{"rendered":"

The SNB yesterday announced that it would raise interest rates by 50 basis points as was anticipated. The SNB claimed that the UBS takeover of Credit Suisse had averted a potential financial disaster with severe implications for the banking industry on a global level. Reuters quotes SNB\u2019s Chairman Jordan as stating, \u201cThe multi-billion Swiss francs rescue package brokered by the SNB, government and regulator on Sunday prevent a systemic crisis.\u201d Implying that the Credit Suisse scenario was also an outlier and that having taken swift and decisive action investors should not fear the risk of contagion spreading across other institutions as such, the 50-basis points hike was justified to combat inflation and as an attempt by the SNB to increase confidence in the Swiss Banking industry. In addition, the BoE also hiked interest rates by 25 basis points following suit with the decisions of the ECB and the FED considering the higher-than-expected CPI rates for February which as we mentioned yesterday unexpectedly accelerated and as such, it was anticipated that the BoE would raise interest rates. The forward guidance provided by the BoE could be perceived as dovish considering the following statement \u201cCPI inflation increased unexpectedly in the latest release, but it remains likely to fall sharply over the rest of the year\u201d which could be perceived as dovish as it could imply that later on in the year the BoE may decide to keep interest rates as they are or even potentially cut depending on the data that is available. However, we should note that the vote to raise interest rates was 7-2, with the two opting to vote for a hold thus indicating that the balance of power remains unchanged within the BoE as this was the case last meeting therefore, we do not see any immediate change in voting habits by BoE members. Furthermore, BoE\u2019s Mann spoke yesterday stating that \u201cWe may well be entering a very different regime where we are going to have to work much harder as central banks\u201d hinting that the BoE may not be done raising interest rates just yet. In the US we note the reduction in the Initial Jobless claims figure, slightly improving since last time however we should note that this did not result in any significant market reaction as the change in the figure was minimal. Furthermore, we note that Building permits in the US exceeded expectations coming in at 1.550M implying that the US economy is still growing despite high-interest rates as such this could provide some support for the USD despite New Home sales for February coming in lower than expected it appears that these two figures have countered each other out in the market allowing for the USD to remain relatively stable. However, we should that US Treasury Secretary Yellen yesterday according to Reuters, announced that the \u201cUS prepared to take more action to keep bank deposits safe\u201d, thus calming down markets following the two different remarks made by Yellen in her testimony to US Congress and FED Chair Powell during the FOMC meeting.<\/p>\n\n\n\n

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