Over the last month, the banking sector has seen a spate of turmoil triggered by concerns over the possible effects of the steep rise in interest rates. Among possible consequences, we see scope for adjustments to the current regulatory regime to reinforce confidence. More broadly, recent events highlight the magnitude of the transition underway after a long period of exceptionally low interest rates.
In this special edition of our Talking heads podcast, chief market strategist Daniel Morris asks Séverine Piquet, head of credit research, for her assessment of the developments in the financial sector. She points to the kneejerk anxiety in markets and underlines the importance of the ‘measured backstop’ provided by the authorities.
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