Swiss regulators pledged a liquidity lifeline to Credit Suisse in an unprecedented move by a central bank after the flagship Swiss lender’s shares tumbled as much as 30 percent. | Reuters
s have managed their exposure to Credit Suisse in recent months and view risks emanating from the lender as manageable so far, according to three industry sources who declined to be identified because of the sensitivity of the situation.
Rapid rises in interest rates have made it harder for some businesses to pay back or service loans, increasing the chances of losses for lenders who are also worried about a recession. Traders are now betting that the Federal Reserve, which just last week was expected to accelerate its interest-rate-hike campaign in the face of persistent inflation, may be forced to hit pause and even reverse course.
Futures tied to the Fed’s policy rate were pricing a slightly better-than-even chance that policymakers will leave their benchmark lending rate in its current 4.5 percent-4.75 percent range at their upcoming meeting on March 21-22.interest-rate hike at Thursday’s meeting also evaporated quickly as the Credit Suisse rout fanned fears about the health of Europe’sing sector. Money market pricing suggested traders now saw less than a 20% chance of a 50 basis point rate hike at the ECB meeting.
“In the last couple of days as you might expect we’ve seen inflows,” Hamers said. “It is clearly a flight to safety from that perspective, but I think three days don’t make a trend.”Focus is also shifting increasingly to the possibility of tougher rules for, whose collapses triggered the market tumult.
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Swiss central bank throws financial lifeline to Credit Suisse after shares pummeledCredit Suisse leads a rout in European bank shares on Wednesday, March 15, as its largest investor says it cannot provide more financial assistance because of regulatory constraints.
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Large U.S. banks view Credit Suisse exposure as manageable, say sourcesLarge U.S. banks have managed their exposure to Credit Suisse in recent months and view risks from the lender as contained so far, according to three industry sources who declined to be identified because of the sensitivity of the situation. | Reuters
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Credit Suisse to borrow up to $54B as it seeks to calm investor fearsCredit Suisse said it was taking “decisive action” to strengthen its liquidity by borrowing up to $54 billion from the Swiss central bank after a slump in its shares intensified fears about a broader bank deposit crisis. | Reuters
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