Weekly "Focus" and Silicon Valley Tank
Marianne Cizmar - Mar 17, 2023
- Financial Planning
- Portfolio Management
- Retirement
- Special Reports and Newsletters
- Wealth Management
Silicon Valley Bank grabbing headlines this week
Grabbing the headlines over the past week has been the sudden collapse of the Silicon Valley Bank and its impact on the financial markets. An excellent summary of the situation can be found in a publication produced by BMO Private Wealth. Click on the link for Silicon Valley Bank Collapses March 2023 . The turmoil has caused a significant drop in interest rates and created more uncertainty around what the US central bank is going to do next Wednesday when they announce their next interest rate decision. Look for another increase of at least 0.25% and this will be the 9th increase in the Fed Funds Rate since last March 17th as higher rates are being used as a tool to bring down inflation. This increase will preserve the inverted yield curve, which is when shorter-term interest rates are higher than longer-term interest rates and an imperfect predictor of a recession. Last week, the Bank of Canada held interest rates steady and this stance, in addition to lower energy prices, has caused the Canadian dollar to weaken, currently trading under 73 cents to the US dollar (i).
| March 8 | March 17 | |
| US Treasury 2 year yield | 5.06% | 3.97% |
| US Treasury 10 year yield | 3.98% | 3.42% |
Source: FactSet
Click on the link for this week’s "Focus" from our economics team.
Have a great weekend,
Brad
Bradley Goldhar | Senior Portfolio Manager and Senior Investment Advisor
bradley.goldhar@nbpcd.com
Source: (i) FactSet