{"id":522743,"date":"2023-03-12T16:44:31","date_gmt":"2023-03-12T16:44:31","guid":{"rendered":"https:\/\/ktsl888.com\/?p=522743"},"modified":"2023-03-13T05:06:25","modified_gmt":"2023-03-13T05:06:25","slug":"silicon-valley-bank-falls-will-us-interest-rates-fall-to-3-75","status":"publish","type":"post","link":"https:\/\/ktsl888.com\/news\/silicon-valley-bank-falls-will-us-interest-rates-fall-to-3-75\/","title":{"rendered":"Silicon Valley Bank Falls – Will US Interest Rates Drop To 3.75%?"},"content":{"rendered":"
In a recent CNBC interview, Larry McDonald, the author of “The Bear Traps Report,” believes that the current turmoil in the financial markets may prompt a sharp reversal from the Federal Reserve’s aggressive monetary tightening aimed at taming inflation.<\/span><\/p>\n
Federal Reserve’s Hawkish Regime<\/span><\/h2>\n
With the collapse of Silicon Valley Bank, McDonald speculates that the Federal Reserve would slash interest rates by up to 100 basis points by December to prevent contagion in the financial system. This means interest rates could drop from the current 4.75% to 3.75% in the next nine months. \n<\/span><\/p>\n
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The Fed has gradually increased interest rates over the past few years to 4.75% as of March 2023. This monetary policy decision aims to curb inflation which has seen consumer prices rise 7% year-on-year since Dec. 2021. The impact of rate hikes has increased short-term interest rates, making Treasuries more attractive to citizens and leading to deposits being drained from regional banks like SVB.\u00a0<\/span><\/p>\n