• European bourses are softer while US futures are firmer, but still shy of Wednesday's best levels.
• USD remains on the backfoot after Wednesday's FOMC, Antipodeans lead and GBP rises pre-BoE.
• CHF and NOK benefitted from 50bp and 25bp hikes respectively; EGBs remain underpinned but off best following the hawkish action.
• USTs remain firmer with yields lower across the curve but slightly above the mid-week trough.
• Commodities are mixed, with the crude benchmarks attempting to pare back some of their overnight losses while metals glean support from the USD's downside.
• US Treasury Secretary Yellen stated that it is worthwhile for Congress to discuss changes to the FDIC deposit insurance and the Treasury is ready to work with lawmakers
• Looking ahead, highlights include US IJC & New Home Sales, BoE Policy Announcement, Speeches from ECB's Centeno, Knot, Muller & BoE's Mann.

BANKS

• US Treasury Secretary Yellen stated that it is worthwhile for Congress to discuss changes to the FDIC deposit insurance and the Treasury is ready to work with lawmakers.
• FDIC is said to delay the bid deadline for Silicon Valley Private Bank with the bid deadline moved to Friday, while the FDIC expects to have an announcement of a decision on SVB this weekend, according to a spokesperson.
• JPMorgan (JPM) CEO Dimon met with White House economic council chief Brainard during a pre-planned trip to Washington DC.
• FINMA, swiss regulator, provides information on writing down AT1: instructed Credit Suisse (CSGN SW) to completely write down AT1 instruments and to inform bondholders . Tier 2 bonds will not be written down. AT1 instruments issued by Credit Suisse contractually provide that they will be completely written down in a "viability event", conditions were met as Credit Suisse received extraordinary liquidity assistance loans.

CENTRAL BANK DECISIONS

• SNB hikes by 50bps to 1.50% vs exp. 1.50% (prev. 1.00%); does not rule out further hikes; reiterates language around price stability and FX intervention. Further increased its inflation forecasts, with CPI now not seen dropping back into the 0-2% target band until Q2-2023 (prev. Q4-2023). Click here for full details, reaction & analysis.
• Norges Bank hikes by 25bps to 3.00% vs exp. 3.00% (prev. 2.75%); the policy rate will be raised further in May; decision unanimous. Rate path now implies an end-2023 rate of 3.60% (prev. 3.08%). Click here for full details, reaction & analysis.
• Click here for the BoE preview, due 12:00GMT/08:00EDT.
• Brazilian Central Bank maintained the Selic rate at 13.75%, as expected, while it will remain vigilant and will assess if the strategy of maintaining the Selic rate for a sufficiently long period of time will be enough to ensure the convergence of inflation. BCB added that inflation expectations have shown additional deterioration, especially at longer horizons and they will not hesitate to resume the tightening cycle if the disinflationary process does not proceed as expected.

EUROPEAN TRADE

EQUITIES

• European bourses began the session mixed/flat, but have since dipped more convincingly into negative territory with newsflow focused on hawkish Central Bank action post-Fed thus far.
• Once again, the FTSE 100 is lagging its peers as focus remains firmly on the upcoming BoE announcement, FTSE 100 -1.0%.
• Stateside, futures are firmer though remain shy of Wednesday's best levels and have most recently eased off the sessions peak given the above action, ES +0.4%.
• Citi cuts their Stoxx 600 end-2023 forecast to 445 (prev. 475); FTSE 100 cut to 7600 (prev. 8000); downgrades Banks to Neutral (prev. Overweight).
• Click here for more detail.

FX

• The USD remains on the back-foot after Wednesday's FOMC, though the DXY is back towards a 102.44 high after briefly printing a fresh March low of 101.91.
• Action which supports peers across the board and features antipodeans outperforming after recent pressure, NZD leading and cognisant of RBNZ's Conway emphasising that inflation remains high and widespread; NZD/USD and AUD/USD testing 0.63 and 0.6750 respectively.
• GBP is next best ahead of the BoE, Cable at a fresh March peak of 1.2343 with 25bp fully priced and a peak of around 4.45% (current 4.00%) implied.
• The single currency, EUR, is underpinned by the USD but with EUR/GBP pressure preventing any further appreciation; EUR/USD holding sub-1.09 while EUR/GBP near the 0.8832 low.
• Finally, CHF benefitted from the SNB's hawkish-hike while the NOK is back to pre-release levels as expectations for a 50bp hike unwind while the hawkish repo path adjustments are factored in.
• PBoC set USD/CNY mid-point at 6.8709 vs exp. 6.8719 (prev. 6.8715)
• Click here for more detail.

FIXED INCOME

• EGBs are underpinned with yields softer across the curve post-Fed while Gilts are closer to the unchanged mark pre-BoE, though the morning's hawkish action has sparked a pullback from best levels.
• Bunds hold around 136.00 and the 10yr yield now back above 2.25% after dipping to a 2.22% low; modest upside was seen in Bunds following Germany leaving its Q2 issuance calendar unrevised vs the prelim. FY release.
• Stateside, USTs continue to derive support from Wednesday's announcements; though, the yield curve has lifted marginally from the mid-week trough, but does remain lower overall with action most pronounced in the belly.
• German Q2 issuance calendar sees no changes vs the prelim. annual release.
• Click here for more detail.

COMMODITIES

• Commodities are mixed, with the crude benchmarks attempting to pare back some of their overnight losses while metals glean support from the USD's downside.
• Specifically, WTI and Brent are towards the lower-end of USD 69.91-70.79/bbl and USD 75.76-76.66/bbl parameters, though the benchmarks are holding above USD 70 and USD 76 respectively.
• Both precious and base metals are benefitting from the softer dollar; spot gold towards the upper-end of USD 1964-1983/oz parameters, just shy of Wednesday's USD 1985/oz best with base metals supported but off best given the broader risk tone.
• Iran's Finance Minister said Iran achieved its highest level of oil exports for at least two years last month, according to FT.
• Goldman Sachs said gold remains the best safe-haven asset for financial risks and raised its gold target to USD 2050/oz from 1950/oz, while it added that Chinese demand continues to surge across the commodity complex with oil demand topping 16mln bpd and it remains very positive on commodity prices with 12-month forecasted returns of 27.9% for S&P GSCI.
• Click here for more detail.

NOTABLE HEADLINES

• ECB's Muller says inflation is a bigger problem than the increase in borrowing costs. Lions share of hikes are behind us; ECB is likely to increase rates by a little.
• ECB's Stournaras says should not commit to any rates in advance.
• Italy is reportedly preparing a new package of measures worth some EUR 5bln to aid firms and families cope with energy bills, and could be unveiled next week, according to Reuters sources.

NOTABLE US HEADLINES

• UBS no longer expects the Fed to raise rates in June; reduces its terminal rate forecast range to 5-5.25% from 5.25-5.5% previously.

GEOPOLITICS

• China's military said it monitored and drove away a US destroyer which entered the South China Sea Paracel Islands, although the US Navy later said that the Chinese military's statement is false regarding a US destroyer being expelled from the South China Sea.
• Taiwan's Foreign Minister said President Tsai's meeting with the US House Speaker is still being arranged, according to Reuters.
• Saudi Arabia and Iran's Foreign Ministers agreed to meet soon to pave the way for the reopening of embassies, according to the Saudi state news agency.
• Russian Foreign Ministry Lavrov is to hold discussions with Iran's top diplomat on March 29th in Moscow, according to Tass.
• US mulls opening Pacific defense pact with Britain and Australia to more countries, according to Semafor.
• US reportedly plans to send aging A-10 attack planes to the Middle East while shifting newer jets to Asia and Europe, according to US officials cited by WSJ.

CRYPTO

• Bitcoin is around the mid-point of circa. USD 1.5k parameters which remain well within the confines of Wednesday's action.
• Coinbase (COIN) said it received a Wells notice from the US SEC on enforcement action alleging violation of federal securities laws and believes potential enforcement actions would relate to aspects of Co.'s spot market, staking service Coinbase Earn, Coinbase Prime and aspects of Coinbase Wallet, while potential civil action may seek injunctive relief, disgorgement and civil penalties, according to Reuters.
• Binance is charging fees for Bitcoin trading gains, according to WSJ.

APAC TRADE

• APAC stocks traded mixed with price action choppy as markets digested the FOMC where the Fed delivered a widely expected 25bps rate hike and maintained its terminal rate view but dropped its reference regarding expectations that ‘ongoing’ rate hikes will be appropriate.
• ASX 200 declined amid the uninspired mood across most industries with underperformance in tech and mining.
• Nikkei 225 was contained by weakness in financials and after Japan maintained the overall assessment of the economy but cut the assessment on corporate profits and production for the first time since April 2020.
• Hang Seng and Shanghai Comp. swung between gains and losses with optimism in Hong Kong following earnings releases from Orient Overseas International and Tencent whereby the advances in the latter inspired its tech peers, although participants also digested a rate hike by the HKMA which moved in lockstep with the Fed.

NOTABLE ASIA-PAC HEADLINES

• HKMA raised its base rate by 25bps to 5.25%, as expected, which is in lockstep with the Fed.
• RBNZ Chief Economist Conway said inflation is high and widespread because strong demand outstripped supply, while he added that they are incredibly determined to get inflation and inflation expectations back to the target. Furthermore, Conway expects monetary policy tightening to cause the New Zealand economy to enter a mild recession later this year as demand slows, as well as noted that the OCR is now comfortably above neutral and having the desired contractionary effect, according to Reuters.