Headlines - Week Ended March 10, 2023

Powell’s Hawkish Comments Jolt Markets, The Bank Of Canada Diverges From The Fed, And A Bank Run Causes The Collapse of SVB Financial.

By Aiden Singh, March 10, 2023

Tuesday

Reserve Bank of Australia Increased Its Policy Interest by 25 BPS To 3.6%.

Federal Reserve Chairman Jerome Powell In Congressional Testimony: 'The ultimate level of interest rates is likely to be higher than previously anticipated.'

Following Powell’s Hawkish Comments, Fed Fund Futures Briefly Price In 50 BPS Rate Hike At Next Fed Meeting.

Bond Traders Respond To Powell’s Comments: U.S. Yield Curve Reaches Most Inverted Level Since 1981. 2-Year Treasury Yields Rise To 5%.

Wednesday

Euroarea GDP Was Unchanged In Q4.

US Mortgage Applications Increased 7.4% Week Over Week During The Week Ended March 3.

In Divergence From Federal Reserve, The Bank of Canada Left Its Policy Interest Rate Unchanged. Bank of Canada Statement: ‘Overall, the latest data remains in line with the Bank’s expectation that CPI inflation will come down to around 3% in the middle of this year.’ 

Aswath Damodaran: Attempts to tax [stock] buybacks may backfire. (Read)

Thursday

Japanese GDP Grew An Annualized 0.1% In Q4 2022.

US Initial Claims For State Unemployment Benefits Rose 21,000 To A Seasonally Adjusted 211,000 For The Week Ended March 4.

Shares In Crypto Bank Silvergate Capital Plunged 40% On News It’s Winding Down Bank, Returning Deposits. News Takes Cryptocurrency Complex Lower.

Shares In Venture Capital Focused Bank SVB Financial Fall 60%.

Johan Hombert: AI not yet a substitute for humans in finance. (Read)

Friday

Bank of Japan Keeps Overnight Interest Rate At -0.1%, Maintains Bond Yield Control Policy Which Allows 10-Year Yields To Fluctuate Between -0.5% and 0.5%.

BOJ’s Kuroda Chairs Last Policy Board Meeting. Kazuo Ueda To Take Over On April 9.

German Revised CPI Figures For February Indicate 8.7% YoY Inflation. Figure Unchanged From January.

UK Economy Grew 0.3% In January Following 0.5% Contraction In December. GDP Remained Unchanged In The Three Months To January 2023 Compared With The Three Months To October 2022.

U.S. Unemployment Rate Rises To 3.6%.

Canadian Unemployment Rate Unchanged At 5%.

Bill Ackman: Government Should Consider A Bailout Of SVB Financial If Needed.

Fed Fund Futures Currently Pricing In 25 BPS Rate Hike At Next Fed Meeting, Peak Policy Interest Rate of ~5.25%.

2-Year Treasury Yield Falls Below 4.7%.

SVB Financial Talks To Raise Capital, Sell Itself Fail. Regulators Close SVB Financial, FDIC Takes Control Of Deposits. Trading In Shares Remains Halted.

Shares In Crypto Focused Signature Bank Fall 20% In Wake Of SVB Collapse, Silvergate Capital Struggles. Trade In Shares Temporarily Halted.