DIRS.INFO The most relevant business & tech news

A 25 basis-point rise would take Bank Rate to 4.25%, where most economists said it would stay for at least a year. But investors have turned more doubtful about the BoE's appetite for more rate hikes in recent days amid mounting anxieties about the global banking sector. Interest rate futures on Friday showed traders were putting a roughly 50-50 chance on the BoE maintaining Bank Rate at 4% next week. Investors expect a 25 basis-point rate hike from the U.S. Federal Reserve on Wednesday, a day before the BoE's announcement. Forty-two of 47 economists polled by Reuters between March 13-16 expected the BoE to announce a 25 basis-point hike, hold Bank Rate at 4.25% for at least year and then lower it.

☆ OECD hikes growth outlook, but warns recovery fragile
▼ + stars: | 2023-03-17 | by ( Leigh Thomas | ) www.reuters.com time to read: +3 min

After growth last year of 3.2%, the world economy is on course to expand 2.6% as central bank tightening takes full effect, the Organisation for Economic Cooperation and Development said in its interim economic outlook. The Paris-based organisation raised its forecast for global growth from 2.2% in its last Economic Outlook in November, citing a decline in energy and food prices and China's easing of its anti-COVID restrictions. Setting aside turmoil in financial markets following SVB's failure and continued worries about Swiss lender Credit Suisse, the European Central Bank hiked interest rates by a further half percentage point on Thursday to fight inflation. The OECD forecast that U.S. economic growth would slow from 1.5% this year to 0.9% next year as higher interest rates cooled demand. The OECD had previously forecast 0.5% and 1.4% growth respectively.

☆ ECB pushes through 50 bps rate hike despite market turmoil
▼ + stars: | 2023-03-16 | by ( ) www.reuters.com time to read: +2 min

The ECB raised its three policy rates by 50 basis points in its sixth consecutive rate hike and said future moves will depend on incoming data. Thursday's decision increases the rate the ECB pays on bank deposits, which is the benchmark for borrowing costs in the euro zone, to 3.0% from 2.5%. Some calm returned to financial markets on Thursday after the Swiss central bank threw Credit Suisse a $54 billion lifeline overnight. ECB President Christine Lagarde will be certain to face questions about the turmoil and the euro zone banking sector at a news conference starting at 1345 GMT. After Thursday's hike, the rate on the ECB's little used weekly cash auctions will rise to 3.5% while overnight loans from the central bank will now cost 3.75%.

"Since mid-October, 10-year gilt rates have fallen, debt servicing costs are down, mortgage rates are lower and inflation has peaked. The International Monetary Fund says our approach means the UK economy is on the right track." [1/6] Britain's Chancellor of the Exchequer Jeremy Hunt holds the budget box on Downing Street in London, Britain March 15, 2023. The OBR forecast economic output would grow by 1.8% in 2024 and by 2.5% in 2025, Hunt said, compared with its previous forecasts for growth of 1.3% and 2.6% respectively. Many economists have said Hunt probably wants to hold back some fiscal firepower for closer to the next national election.

Two supervisory sources told Reuters that the European Central Bank (ECB) had contacted banks on its watch to quiz them about their exposures to Credit Suisse. The Swiss National Bank declined to comment on Switzerland's second-largest bank, after its largest investor said it could not provide Credit Suisse with more financial assistance because of regulatory constraints. Credit Suisse had appealed to the Swiss National Bank and Swiss financial watchdog FINMA for a public show of support, the Financial Times reported. The logo of Swiss bank Credit Suisse is seen in front of an office building in Zurich, Switzerland October 26, 2022. Ralph Hamers, CEO of Credit Suisse rival UBS (UBSG.S) said market turmoil has steered more money its way.

The drop in Credit Suisse shares led a 7% fall in the European banking index (.SX7P), while five-year credit default swaps (CDS) for the flagship Swiss bank hit a new record high, highlighting increasing investor concerns. We move from the problems of American banks to those of European banks, first of all Credit Suisse," said Carlo Franchini, head of institutional clients at Banca Ifigest in Milan. The Swiss National Bank declined to comment on Switzerland's second-largest bank, after its largest investor said it could not provide Credit Suisse with more financial assistance because of regulatory constrains. The logo of Swiss bank Credit Suisse is seen in front of an office building in Zurich, Switzerland October 26, 2022. Ralph Hamers, CEO of Credit Suisse rival UBS (UBSG.S) said it has benefited from market turmoil and seen money inflows.

[1/6] Britain's Chancellor of the Exchequer Jeremy Hunt holds the budget box on Downing Street in London, Britain March 15, 2023. The International Monetary Fund says our approach means the UK economy is on the right track." After the shocks of Brexit, a heavy COVID-19 hit and double-digit inflation, Britain's economy is the only one among Group of Seven nations yet to recover its pre-pandemic size, having already suffered a decade of near-stagnant income growth. "Despite continuing global instability, the OBR report today that inflation in the UK will fall from 10.7% in the final quarter of last year to 2.9% by the end of 2023," Hunt said. Many economists have said Hunt probably wants to hold back some fiscal firepower for closer to the next national election.

March 15 (Reuters) - European bank stocks fell sharply on Wednesday, with embattled Credit Suisse (CSGN.S) tumbling to a new low, on renewed investor concerns about stresses within the sector triggered by Silicon Valley Bank's sudden collapse. A more than 20% drop in Credit Suisse shares led a 6% plus fall in the European banking index (.SX7P), while five-year credit default swaps (CDS) for the flagship Swiss bank hit a new record high, highlighting increasing investor concerns. We move from the problems of American banks to those of European banks, first of all Credit Suisse," said Carlo Franchini, head of institutional clients at Banca Ifigest in Milan. BlackRock (BLK.N) Chief Executive Laurence Fink warned on Wednesday that the U.S. regional banking sector remains at risk, and predicted further high inflation and rate increases. And in an attempt to avert a similar crisis down the line, the U.S. Federal Reserve is considering tougher rules and oversight for midsize banks similar in size to SVB.

☆ Britain to bolster the City after Silicon Valley Bank collapse
▼ + stars: | 2023-03-15 | by ( Huw Jones | ) www.reuters.com time to read: +4 min

[1/2] A person walks over Millennium Bridge amidst early morning fog, as the sun rises beyond the City of London financial district in the background, in London, Britain, February 8, 2023. Following the collapse of its parent company in the United States, Silicon Valley Bank's UK arm was sold to HSBC over the weekend to avoid disrupting its customers in Britain. Hunt said he would make a statement in the autumn on how the UK financial system would be strengthened. City Minister Andrew Griffith has said that an accounting rule for pension funds has become a "performance penalty" which holds back investment in Britain. The financial sector has called for faster implementation of the proposals after Amsterdam overtook London as Europe's biggest share trading centre.

Summary ECB signalled 50 bps hikeMarkets doubt its resolve and price 25 bpsFinancial turmoil seen derailing rate hike plansInflation to stay above target through 2025FRANKFURT, March 16 (Reuters) - European Central Bank policymakers are meeting on Thursday amidst turmoil in financial markets that could force it to divert from plans for another hefty interest rate hike even though inflation remains too high. Now the ECB must reconcile its inflation-fighting credibility with the need to maintain financial stability in the face of overwhelmingly imported turmoil. Complicating its task, the central bank for the 20 countries that use the euro currency has essentially already committed to a 50 basis point increase on Thursday. Money market pricing suggests that investors now see just a 30% chance of a 50 basis point increase, down from as high as 90% early on Wednesday. The peak ECB rate, also known as terminal rate, is now seen at only around 3.25%, down from 4.1% last week, an exceptional reversal in market pricing.

☆ Silicon Valley Bank collapse: What you need to know now
▼ + stars: | 2023-03-14 | by ( ) www.reuters.com time to read: +3 min

March 14 (Reuters) - U.S. bank stocks jumped on Tuesday, recovering some ground after the failure of Silicon Valley Bank (SIVB.O) and Signature Bank (SBNY.O) triggered heavy selling by investors who were already anxious about the impact on lenders of rising interest rates. Senator Elizabeth Warren called on Federal Reserve Chair Jerome Powell to recuse himself from an internal review of recent bank failures, saying his actions "directly contributed" to them. * Chancellor Olaf Scholz said Germans should not have major concerns and that regulators had learned lessons from the global financial crisis in 2008. MARKETS* U.S. regional bank shares bounced, with First Republic Bank (FRC.N) up 42.3% at $44.40 a share, a day after touching a record low of $17.53. * Global shares turned higher, ending a five-session rout, as U.S. inflation data bolstered bets on a smaller interest rate hike by the Federal Reserve next week.

Worries about potential contagion had also slammed bank shares in Asia and Europe as investors re-examined their risks, despite assurances from U.S. President Joe Biden and other global policymakers that the financial system is safe. In Europe, where some see lenders as less vulnerable, the banking index (.SX7P) first fell then recovered to rise 2.7%. Asian banking stocks had extended their declines overnight, with Japanese banks hard-hit despite reassurances from the Bank of Japan said about their capital buffers. Regulator FDIC had moved swiftly to close New York's Signature Bank SBNY.O as well as taking control of SVB. Citing people familiar with the matter, the WSJ said the investigators are also examining stock sales that SVB Financial Group's executives made days before SVB failed, adding that the Justice Department's probe involves the department's fraud prosecutors in Washington and San Francisco.

Banking giants Citi (C.N), Wells Fargo (WFC.N) and JP Morgan (JPM.N) were also 1%-3% higher in the pre-market. Japanese financial institutions have sufficient capital buffers to absorb losses caused by external factors, including risks caused by SVB's collapse, the Bank of Japan said. Traders currently see a 50% chance of no rate hike at that meeting, with rate cuts priced in for the second half of the year. The prospect of higher rates had been "the reason investors have been really excited about Japan bank stocks", Ikeda added. We just ask for a little bit of time because of the volume," FDIC employee Luis Mayorga told waiting customers.

"This is part of the process of the knob being turned to tighten financial conditions to make sure that we are on our way to normalising a higher interest rate world," Pick said. Shockwaves from the collapse of SVB put fresh pressure on bank stocks across Asia and Europe on Tuesday as worries about potential contagion to other lenders deepened. Morgan Stanley's Pick said the events of the last week may give the Federal Reserve pause for thought on its own rate plans. He was speaking ahead of closely-watched U.S. inflation data later in the day. Analysts at Goldman Sachs said in a note on Monday that U.S. banking stresses could spread directly to European banks.

[1/2] Customers wait in line outside a branch of the Silicon Valley Bank in Wellesley, Massachusetts, U.S., March 13, 2023. REUTERS/Brian SnyderMarch 14 (Reuters) - Silicon Valley Bank's collapse continued to pound global bank stocks on Tuesday as investors fretted over the financial health of some lenders, despite assurances from U.S. President Joe Biden and other policymakers. The European banks index (.SX7P) fell 0.6% after posting its biggest percentage loss in more than a year on Monday. "Bank runs have started (and) interbank markets have become stressed," said Damien Boey, chief equity strategist at Sydney-based investment bank Barrenjoey. The prospect of higher interest rates had been "the reason investors have been really excited about Japan bank stocks", Ikeda added.

To compound the problem, British shoppers are themselves starting to spend more in the European Union, where they can also reclaim the value-added tax (VAT) charged on goods. OWN GOALBurberry BRBY.L, Britain's biggest luxury retail brand, warned last year that London was losing out to other European cities over the VAT rule. "That's why tax-free was so important for them, and now we are the only country in Europe that doesn't offer it." Cadogan, the main landlord in the west London districts of Chelsea and Knightsbridge, whose estate spans over 90 acres, also called on the government to act. He said he had not considered the VAT issue before, because he was generally spending his parents' money.

SVB's meltdown sparked a partisan battle in Washington on Monday, with Democrats arguing that a Trump-era change to bank oversight rules undermined the stability of regional banks. In the money markets, indicators of credit risk in the U.S. and euro zone banking systems edged up. [1/3] U.S. President Joe Biden delivers remarks on the banking crisis after the collapse of Silicon Valley Bank (SVB) and Signature Bank, in the Roosevelt Room at the White House in Washington, D.C., U.S. March 13, 2023. On Monday morning, U.S. bank regulators sought to reassure nervous customers who lined up outside SVB's Santa Clara, California, headquarters, offering coffee and donuts. A furious race to reprice interest rate expectations also sent waves through markets as investors bet the Fed will be reluctant to hike next week.

Biden said his administration's actions over the weekend meant "Americans can have confidence that the banking system is safe", while also promising stiffer regulation after the biggest U.S. bank failure since the 2008 financial crisis. Shares in U.S. banking giants JP Morgan Chase (JPM.N), Morgan Stanley (MS.N) and Bank of America (BAC.N) nevertheless weakened. But your second thought is, how big was that crisis, how big were the risks that this step had to be taken?" U.S. regulators stepped in on Sunday after the collapse of SVB, which had seen a run after a big bond portfolio hit. [1/3] U.S. President Joe Biden delivers remarks on the banking crisis after the collapse of Silicon Valley Bank (SVB) and Signature Bank, in the Roosevelt Room at the White House in Washington, D.C., U.S. March 13, 2023.

Germany's Commerzbank (CBKG.DE) fell as much as 12.7%, while Credit Suisse (CSGN.S) hit a new record low after falling 15%. Biden said his administration's rapid actions at the weekend should reassure Americans that the U.S. banking system is safe, and promised stiffer bank regulation after the country's biggest bank failure since the 2008 financial crisis. "Americans can have confidence that the banking system is safe. But big U.S. banks including JP Morgan Chase (JPM.N), Morgan Stanley (MS.N) and Bank of America (BAC.N) also weakened. In the money markets, a closely watched indicator of credit risk in the U.S. banking system edged up, as did other indicators of credit risk in the euro zone.

[1/3] U.S. President Joe Biden delivers remarks on the banking crisis after the collapse of Silicon Valley Bank (SVB) and Signature Bank, in the Roosevelt Room at the White House in Washington, D.C., U.S. March 13, 2023. Germany's Commerzbank (CBKG.DE) fell as much as 12.7%, while Credit Suisse (CSGN.S) hit a new record low after falling more than 15%. Dowding said he did not think that a lot of the issues affecting U.S. banks would be present in European lenders. It said Silicon Valley Bank UK had loans of around 5.5 billion pounds and deposits of around 6.7 billion pounds as of March 10. U.S. banks lost more than $100 billion in stock market value late last week following SVB's failure, while European banks have now lost a similar amount, a Reuters calculation showed.

Markets remained fragile, with European bank stocks tumbling over 5% on Monday and U.S. banks set to open lower (.SX7P). Markets also moderated their view on UK rates and were pricing in a roughly 75% chance of a 25 bps hike when the Bank of England meets next week. Goldman Sachs said on Sunday the banking stress meant it no longer expected the Fed to hike rates next week. "It's not going to want to go clattering in with another 50 (bps hike) and see some other financial institution getting hosed." A new Fed bank funding scheme aimed at addressing some of Silicon Valley Bank's apparent problems with losses in its bond portfolio is expected to further help with stability for banks and bonds.

"HSBC is Europe's largest bank, and SVB UK customers should feel reassured by the strength, safety and security that brings them," Britain's finance minister Jeremy Hunt said. The Bank of England said it had organised the sale to underpin confidence in the financial system and minimise any fallout for British technology firms. "This acquisition makes excellent strategic sense for our business in the UK," HSBC CEO Noel Quinn said in a statement. The Bank of England said SVB UK had a total balance sheet size of around 8.8 billion pounds. Other potential buyers for SVB UK had included Bank of London, which said on Sunday it had submitted a formal proposal.

☆ Analysis: Wage catch-up to prolong Europe's inflation battle
▼ + stars: | 2023-03-10 | by ( Balazs Koranyi | ) www.reuters.com time to read: +6 min

"Part of the wage increase is understandable," said Jens Ulbrich, chief economist at Germany's Bundesbank. Yet the rapid wage growth underway now will hamper the European Central Bank's efforts to get inflation back to its 2% target, and possibly force it to keep interest rates high for longer. "We are taking a first step, but much more is needed to reverse the years of lopsided wage growth," Kager added. "The inflation trend, food and especially energy prices are tearing deep holes in our workers' budgets," ver.di Chairman Frank Werneke said. "The high levels of wage growth projected for 2023 and 2024 can be expected to make wages an increasingly dominant driver of underlying inflation in the euro area," Lane says.

"I'd love to work more hours," Sharples told Reuters at the home in northern England she shares with her children and web-developer husband. The Centre for Progressive Policy (CPP) think tank has estimated that around 1.5 million British mums would work more hours if childcare permitted. Business groups and researchers argue that acting on childcare in his March 15 budget would do more to unlock greater economic growth. The government says it has spent more than 20 billion pounds in the last five years helping with the cost of childcare. "Childcare unlocks not just the potential of children, but also the potential of parents," Labour leader Keir Starmer said last month.

☆ Exclusive: Snapchat kicks few children off app in Britain, data given to regulator shows
▼ + stars: | 2023-03-03 | by ( Martin Coulter | ) www.reuters.com time to read: +5 min

These restrictions are intended to protect the privacy and safety of young children. The regulator also found Snapchat was the most popular app for underage social media users. RISKS TO YOUNG CHILDRENSocial media poses serious risks to young children, child safety advocates say. Richard Collard, associate head of child safety online at the NSPCC, said it was "incredibly alarming" how few underage users Snapchat appeared to be removing. Britain, like the European Union and other countries, has been seeking ways to protect social media users, in particular children, from harmful content without damaging free speech.

Search resuls for: "Catherine Evans"

25 mentions found