As of April 26, emergency loan funds stood at $155.2 billion. Discount window loans were $73.9 billion and bank term loans were $81.3 billion. The previous week’s emergency loan fund was $143.9 billion. After the bankruptcy of small and medium-sized banks such as SVB and Signature, the Fed is supplying emergency loan funds.
Concerns about a bank run are growing as the banking crisis reignited, with First Republic stock prices plummeting by more than 90%. As a result, an increasing number of banks are receiving emergency loans from the Fed.
Source = Bloomberg
The banking crisis, which had seemed to subside, flared up again after the news that FRC deposits were expelled on a larger scale than expected.
It is highly likely that the Fed will raise its benchmark interest rate by another 25 basis points at its Open Market Committee meeting scheduled for next week. Since the root cause of the banking crisis is the interest rate hike policy, financial authorities such as the Federal Reserve are unable to come up with a sharp solution.
“The Fed continues to monitor the resilience of the economy,” said Phraya Misra, strategist at TD Securities. In particular, you’re going to see how tight the credit situation is.”
With the banking crisis re-igniting, attention is focusing on whether the Fed’s interest rate hike policy can be finished early and whether policy changes can be made.
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“US FDIC, First Republic soon under court receivership” – Reuters
2023-04-29 02:13:00
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