Pricing on swaps linked to Fed meetings suggest traders now expect that the central bank’s policy rate will peak near 5.4pc in July, and end the year near 5.1pc.
Bond traders are quickly lowering their expectations for how high the Federal Reserve will push the borrowing costs — while also once again fully pricing in a rate cut from the peak level by year-end — as banking sector concerns mount.
To varying degrees, shareholders punished the entire banking sector. Financial companies in the S&P 500 are down about 7 per cent as a group on the week.a reaction to Fed chairman Jerome Powell seeming to open the door to a re-acceleration in the pace of rate hikes Fed officials “do have to pay attention to this because something is apparently starting to break, and they have raised rates a lot”, said Tony Farren, managing director at Mischler Financial Group. “The reaction to Powell was way too aggressive.”
“It appears that the fear of a hard landing is starting to be built back into rate expectations,” said Mark Dowding, chief investment officer at RBC BlueBay Asset Management. “Bank stress may be seen as a sign that monetary policy is working to tighten conditions, albeit with a lag.”
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
'One line of code' could have fixed Uber's surge pricing after Sydney train chaosStranded Sydneysiders were left fuming after Uber's fares skyrocketed on Wednesday due to the company's algorithms around price surging. AI experts say the same algorithms can also prevent this from happening.
Read more »
Summers sees near even odds Fed must lift to 6pc or higherThe former US Treasury secretary said the February jobs data suggest the economy is still expanding “above the speed limit”.
Read more »
Money guru’s shock cash offer to struggling homeowners - realestate.com.auFed-up finance guru Mark Bouris is offering to help struggling homeowners meet their skyrocketing loan repayments with a cash injection.
Read more »
Australian households brace for higher power bills as Origin Energy raises default market offerSky News host Sharri Markson says Australian households are set to face an increase in their power bills with Origin Energy revealing that up to 600,000 households can expect at least a 20 per cent rise in their default market offer from July.
Read more »
US banks, jobs report rattle sharemarketsInvestors have been rattled by a bank sell-off on Wall Street after Silicon Valley Bank tanked 60 per cent and fears of another stronger-than-expected payroll report.
Read more »
All four big banks pass on interest rate hike to customersAll four of Australia's big banks have passed on the Reserve Bank of Australia's 25 basis point interest rate hike to customers, with the Commonwealth Bank the last of the quartet to confirm their decision. 9News
Read more »