Financial Markets Daily Report16 March 2023
Risk aversion extended across financial markets during a volatile session on Wednesday, fueled by concerns about the health of the banking sector in Europe, in the aftermath of the collapse of some regional banks in the US and renewed concerns about the financial position of Swiss lender Credit Suisse.
- Risk aversion extended across financial markets during a volatile session on Wednesday, fueled by concerns about the health of the banking sector in Europe, in the aftermath of the collapse of some regional banks in the US and renewed concerns about the financial position of Swiss lender Credit Suisse.
- On the data front, PPI inflation in the US eased more than expected in February (4.6% y/y after 5.0%) while retail sales declined (-0.4% m/m after 3.2%).
- In this context, banks shares fell notably across the board, pushing equity indices down, more acutely in Europe. Sovereign bond yields also resumed its downward trend, spurred by a flight to safety by investors. The USD appreciated against peers, trading near 1.05 against the EUR, while oil prices dropped further on recession fears.
- Today, the ECB will announce monetary policy decisions.