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MARCH 22, 2023

FED ANNOUNCEMENT

Today the Federal Reserve Chair Jerome Powel will be announcing the interest rates and new economic projections. This announcement is sure to have a significant impact on global financial markets, as it aims to find a balance between combating inflation and dealing with an unexpected banking crisis. While interest rates may raise by a quarter of a percentage point – a move that emphasizes combatting inflation, some policymakers may opt to maintain current interest rates as they believe that shoring up financial stability should take precedence.

UBS

UBS has announced its plans to buy back 2.75 billion euros ($3 billion) worth of recently issued debt, including its seniors bail-in notes due in March 2028 and March 2032. The move is aimed at enhancing the trust among bondholders, especially following its recent $3 billion bailout of Credit Suisse. UBS has committed to repurchasing the debt at the same price they were sold on March 9th – before the rescue of Credit Suisse.

In contrast to UBS’s promising offer, Credit Suisse was ordered by the Swiss government to suspend deferred bonuses, causing further distress for bankers who were already experiencing the impact of the bank’s plummeting stocks.

FIRST REPUBLIC BANK

Considering the financial crisis the First Republic Bank is facing due to the loss of 88% of its stock market value this year, Wall Street leaders and US officials are currently discussing the option of the government providing financial support for First Republic Bank to strengthen its financial position and ensure its stability. These talks aim to prevent any other US bank failure, and various measures are being contemplated to attract investors or buyers. Some of these measures include the government playing a role in lifting assets that have decreased the bank’s financial position, as well as offering liability protection, easing capital rules, or relaxing limits on ownership stakes.

STOCK MARKET

The stock market has been unsteady in recent days, European stocks have been moving up and down in a small range, and the future of US stocks looks uncertain as investors await the US Federal Reserve’s decision. This instability is also reflected in Treasury yields, which have fallen slightly following a massive jump earlier this week. Nevertheless, the pound is doing well as UK inflation went up unexpectedly.

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JUNE 24, 2024

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MARKET RECAP – JUNE 21, 2024

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STEEP OUTFLOWS It has been reported that as of yesterday, Bitcoin exchange-traded funds (ETFs) in the U.S. recorded their fifth consecutive day of outflows, losing over $900 million this week. Data from SoSoValue indicates that the 11 listed ETFs experienced a loss of $140 million on Thursday with $1.1 billion in trading volumes. Grayscale’s GBTC, […]

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