Stemming tide of SVB collapse may create other ripples

[LONDON] Central banks and regulators are doing their utmost to counter a nascent banking panic in the US and Europe – so much so that market participants now believe the European Central Bank will either delay or reduce an expected interest rate hike on Thursday (Mar 16).

Planned rate rises by the United States Federal Reserve and the Bank of England in the coming weeks may also be smaller until the ongoing Silicon Valley Bank (SVB) crisis is contained.

The danger is that US and European inflation may accelerate if money is flush. With the global economy on a tightrope, it is clear that central banks have little room for missteps.