On Monday, the dollar maintained its stability. The yen held steady near its seven-week high as investors weighed measures taken by authorities and regulators to calm concerns about the global financial system.
The dollar index, which measures the value of the dollar against six other trading currencies, rose 0.078% to 103.07 today after rising 0.5% on Friday on mounting financial concerns, with prices of Deutsche Bank shares falling 9%.
Following the abrupt bankruptcy of two US lenders and last week’s bailout of troubled Swiss bank Credit Suisse, regulators stepped in to assuage investor concerns, hammering global bank shares throughout the month.
The Federal Deposit Insurance Corporation announced Monday that First Citizens BancShares Inc. would buy all the deposits and loans it holds on behalf of Silicon Valley Bank. On Friday, the US Financial Stability Oversight Board stated that despite pressure on some institutions, the US banking sector remained “strong and robust.” But investors remain cautious.
The yen hit a seven-week high against the dollar on Friday thanks to risk-averse investors, and was expected to gain 4% in March. On Monday, it was last at 130.75.
The Fed raised interest rates
In line with expectations, the Fed raised interest rates by 25 basis points on Wednesday. But due to recent financial instability, the Fed has taken a cautious approach to the forecast. According to the CME FedWatch tool, the probability of the Fed keeping interest rates flat at its next meeting in May is estimated to be over 80%, with markets forecasting a decline as early as July.
Chandler stated: “Fed Fund futures are pricing in a drastic reduction in the coming months, against the unequivocal signal from Powell.” He continued: “This is really aggressive and beyond the realm of possibility.”
Neel Kashkari, president of the Minneapolis Federal Reserve Bank, said Sunday that recent stress in the banking industry and the possibility of a secondary credit crisis had brought the United States closer to recession.
- Meanwhile, the euro was up 0.05% at $1.0764, after falling 0.6% on Friday.
- After falling 0.5% on Friday, the pound was trading at $1.2235, up 0.05% on the day.
- The Australian dollar rose 0.09% to $0.665.
- The kiwi was up 0.03% at $0.620.
In the cryptocurrency sector:
- Bitcoin last rose 0.84% to $27,861.02.
Ethereum rose 0.71% to $1,763.39.
BONUS VIDEO: Weekly summary of market news
(embed)https://www.youtube.com/watch?v=vkqXF4W_wuM(/embed)
!function (f, b, e, v, n, t, s) {
if (f.fbq) return;
n = f.fbq = function () {
n.callMethod ?
n.callMethod.apply(n, arguments) : n.queue.push(arguments)
};
if (!f._fbq) f._fbq = n;
n.push = n;
n.loaded = !0;
n.version = ‘2.0’;
n.queue = ();
t = b.createElement(e);
t.async = !0;
t.src = v;
s = b.getElementsByTagName(e)(0);
s.parentNode.insertBefore(t, s)
}(window, document, ‘script’,
‘https://connect.facebook.net/en_US/fbevents.js’);
fbq(‘init’, ‘504526293689977’);
fbq(‘track’, ‘PageView’);
