Publications

This year had started off very well for banks. In fact, the share price of banks in the eurozone had risen by 20% by Wednesday, March 8; however, in one week these gains have been wiped out. The failure of three banks in the US and the sale of Credit Suisse to UBS have caused turbulence in the global banking system.

2022 has been a dismal year for the fixed income market in general, including sovereign bonds. As the year draws to a close, bond prices, which move inversely to their yields, have fallen by an average of about 15% globally.

The main central banks have brought forward the withdrawal of their monetary stimulus measures (rolled out during the COVID-19 crisis) to anchor inflationary expectations, and are now inclined toward raising interest rates earlier, and possibly even faster, than expected.

Financial markets began the year on a positive note. The progress made in vaccinations, central bank support and the fiscal stimulus programs planned for Europe and the US, helped drive expectations of an economic recovery.

At almost 50 years from the first of the Christmas bonus mandatory in Mexico, the note gives recommendations for using it, and safety and self-control tips for the financial health of workers in Mexico who receives this bonus.

Following the financial crisis that led to a European sovereign crisis in 2012, the European Commission developed a roadmap for the creation of the banking union, based on three key pillars: the Single Supervisory Mechanism (SSM), the Single Resolution Mechanism (SRM) and the Deposit Guarantee Scheme (DGS).

Risk-off mood resurfaced in financial markets, boosting VIX volatility and safe haven demand, although underlying hopes of an eventual trade resolution contained market losses.

The presentation addresses how the post-financial crisis risk perception, tighter regulations, and the high frequency trading have transformed the dynamics of bond market liquidity.