Investors welcomed action on SVB deposits, though speculation is turning to the Fed and whether a high reading on U.S. consumer price figures would increase pressure to raise rates aggressively.
"These are strong moves," said Paul Ashworth, head of North American economics at Capital Economics.
Fed fund futures surged in early trading to imply only a 28% chance of a half-point hike, compared to around 70% before the SVB news broke last week. That, combined with the shift to safety, saw yields on two-year Treasuries dive 47 basis points on Thursday and Friday to stand at 4.58%, a long way from last week's 5.08% peak.
"Accelerating your pace of hikes in the face of a significant bank failure may not be the wisest play for the Fed, especially if subsequent problems emerge stemming from similar root causes – underwater rates portfolios," said John Briggs, global head of economics at NatWest Markets.
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
SVB collapse could add to China stock investors' anxietyChina stock investors, already disillusioned by Beijing's lower-than-expected economic growth target for the year, will be further disheartened by the shock collapse of U.S. lender SVB Financial Group, market participants said.
Read more »
SVB collapse means more stock-market volatility: What investors need to knowHow regulators respond to the 2nd largest bank collapse in U.S. history holds key to market reaction after investors opted to 'sell first, ask questions later.'
Read more »
Dow futures unsteady as stock-market investors watch efforts to avert SVB-inspired bank crisisU.S. equity markets traded unevenly Sunday afternoon, in the aftermath of the failure of Silicon Valley Bank on Friday, which has cast a pall over the...
Read more »
Fed to hold emergency meeting on Monday amid SVB's swift collapse By Investing.com*FED TO HOLD EMERGENCY MEETING ON MONDAY AMID SVB'S SWIFT COLLAPSE -
Read more »
Fed and FDIC discussing backstop to make SVB depositors whole and stem contagion fears: SourceFinancial regulators are discussing two different facilities to manage the fallout from the closure of Silicon Valley Bank.
Read more »
Fed and FDIC discussing backstop to make SVB depositors whole and stem contagion fears: SourceFinancial regulators are discussing two different facilities to manage the fallout from the closure of Silicon Valley Bank if no buyer materializes, according to a source close to the situation.
Read more »