The failures of U.S. lenders Silicon Valley Bank (SVB) and Signature Bank, followed by Credit Suisse’s rescue, and the ensuing turmoil in world markets have re-ignited the recession risks that appeared to have abated just a few weeks ago.
Traders now bet the Federal Reserve is practically done hiking interest rates. Optimism that followed China’s economic reopening and tumbling energy prices early this year has dimmed.
“The bigger, medium-term implication, of what’s happened in the last month is that global growth will be far weaker in six months than we thought even just a few weeks ago,” said Mike Riddell, senior fixed income portfolio manager at Allianz Global Investors.
Source : Recession Fears Re-emerge as Banking Turmoil Continues