Global Risk Recovers !! S&P Says Manageable exposure of Indian Banks to Contagion risk and Unrecognized losses // Year End liquidity tightness for the Indian markets // INR caught in global headwinds // What to expect from Fed ?
After the tumultuous Asian Session yesterday, risk sentiment stabilized overnight as markets took comfort in the spate of liquidity measures announced by CBs media reports of U.S. Treasury Department staff studying if federal regulators have enough emergency authority to insure deposits above the current $250,000 cap on accounts without the consent of Congress and most recently Tsy Secretary Janet Yellen comments " US aggregate deposit outflows from Regional Banks have stabilised. Tsy, Fed, FDIC actiions reduced risk of further bank failures that would have imposed losses on Deposit insurance fund. Similar actions to protect Depositors could be warranted if smaller institutions suffer deposit runs that pose risk of contagion" Sharp moves were seen across Rates. After the sharp dip in rates on write off of AT1 bonds by Credit Suisse, USD bonds pulled back. For Domestic markets, RBI injected liquidity through the LAF window to the tune of 79K crore on 20 Mar ...