The rapid rate hikes implemented by the Federal Reserve to combat inflation have caused instability in the banking system.
The continued implementation of rate hikes that triggered management instability in regional banks is causing concerns about the decline in value of bonds and mortgage-backed securities held by banks, which is resulting in an increase in unrealized losses.
Some regional banks are increasingly dependent on the Federal Reserve for funding and are facing difficulties in raising capital. While the Federal Reserve has suggested the need for a review of bank supervision and regulation, it continues to implement rate hikes.
The Federal Reserve has demonstrated its commitment to maintaining and strengthening a tight financial environment to prioritize inflation suppression, but similar moves are being made by other major central banks, and global debt expansion and rising interest rates are becoming significant risks.
The Federal Reserve misread the post-coronavirus inflation acceleration as “transient” and implemented rapid rate hikes, which have increased the risk of higher inflation rates becoming entrenched. However, as labor markets and prices overheat, policy responses from the Federal Reserve have fallen behind, making it difficult to maintain both price and financial stability.
The rapid rate hikes implemented by the Federal Reserve to combat inflation have caused instability in the banking system.
inflation
インフレーション
The rapid rate hikes implemented by the Federal Reserve to combat inflation have caused instability in the banking system.
instability
不安定さ
The rapid rate hikes implemented by the Federal Reserve to combat inflation have caused instability in the banking system.
regional banks
地方銀行
The continued implementation of rate hikes that triggered management instability in regional banks is causing concerns about the decline in value of bonds and mortgage-backed securities held by banks, which is resulting in an increase in unrealized losses.
bonds
債券
The continued implementation of rate hikes that triggered management instability in regional banks is causing concerns about the decline in value of bonds and mortgage-backed securities held by banks, which is resulting in an increase in unrealized losses.
mortgage-backed securities
抵当担保証券
The continued implementation of rate hikes that triggered management instability in regional banks is causing concerns about the decline in value of bonds and mortgage-backed securities held by banks, which is resulting in an increase in unrealized losses.
funding
資金調達
Some regional banks are increasingly dependent on the Federal Reserve for funding and are facing difficulties in raising capital. While the Federal Reserve has suggested the need for a review of bank supervision and regulation, it continues to implement rate hikes.
supervision
監督
Some regional banks are increasingly dependent on the Federal Reserve for funding and are facing difficulties in raising capital. While the Federal Reserve has suggested the need for a review of bank supervision and regulation, it continues to implement rate hikes.
commitment
献身
The Federal Reserve has demonstrated its commitment to maintaining and strengthening a tight financial environment to prioritize inflation suppression, but similar moves are being made by other major central banks, and global debt expansion and rising interest rates are becoming significant risks.
inflation suppression
インフレ抑制
The Federal Reserve has demonstrated its commitment to maintaining and strengthening a tight financial environment to prioritize inflation suppression, but similar moves are being made by other major central banks, and global debt expansion and rising interest rates are becoming significant risks.
