Here is what you need to know on Monday, March 13:
The US Dollar started the new week under heavy selling pressure with markets reassessing the next Federal Reserve policy action following the collapse of Silicon Valley Bank (SVB). The benchmark 10-year US Treasury bond yield is down 0.7% below 3.7% following Friday's 6% decline and the US Dollar Index stays deep in negative territory at around 104.00 early Monday. There will not be any high-tier macroeconomic data releases featured in the economic calendar on Monday.
As the Fed raised interest rates, the value of long-term bonds that were collected by SVB during the ultra-low Fed interest rate regime continued to decline. With start-ups starting to draw down funds held by SVB due to higher borrowing costs, the bank faced a capital crisis and announced that it will be selling more than $2 billion worth of new shares to solve the liquidity crunch on Wednesday. This decision caused companies and depositors to rush to withdraw their money from the bank, leading to the collapse of SVB by Friday.
Over the weekend, the Federal Deposit Insurance Corporation (FDIC) took control of the New York-based Signature Bank. Meanwhile, US authorities launched emergency measures on Sunday to avoid collateral damage in the banking system. Regulators assured customers that they will have access to all their deposits starting Monday. Moreover, the Fed introduced a new facility that will provide loans up to one-year for institutions that were impacted by the failure of SVB.
According to CME Group FedWatch Tool, markets are currently pricing in a 96% probability of a 25 basis points rate hike at the next FOMC meeting. Earlier in the day, "in light of recent stress in the banking system, we no longer expect the FOMC to deliver a rate hike at its March 22 meeting with considerable uncertainty about the path beyond March," Goldman Sachs said.
EUR/USD extended its rally early Monday and reached its highest level in a month above 1.0700. As of writing, the pair was up 0.75% on the day at 1.0720.
GBP/USD preserves its bullish momentum and trades in positive territory at around 1.2100. HSBC UK Bank plc announced recently that it has acquired SVB's UK unit, Silicon Valley Bank UK Limited.
Pressured by the broad-based US Dollar weakness, USD/JPY fell sharply during the Asian trading hours before staging a technical correction. As of writing, the pair was down 0.4% on the day at 134.45.
Gold price capitalized on the risk-averse market environment and retreating US Treasury bond yields. XAU/USD opened with a bullish gap and reached its highest level since early February at $1,894 before retreating below $1,880.
Following the sharp decline witnessed in the week, Bitcoin recovered sharply over the weekend, gaining nearly 8% on Sunday. BTC/USD was last seen rising more than 1% on the day at $22,550. Ethereum rose nearly 10% over the weekend and ended up closing the week in positive territory. ETH/USD continues to stretch higher and was last up 1.7% at $1,620.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD turns south toward 0.6500 amid renewed US Dollar buying
AUD/USD is back in the red, easing toward 0.6500 early Wednesday amid the mixed Chinese inflation data. The pair gives up the RBA's surprise on-hold decision-led uptick once again as Trump's planned tariffs on Copper act as a headwind for the resources-linked Aussie. The US Dollar resurgence also weighs on the pair ahead of Fed Minutes.
USD/JPY climbs above 147.00 on USD strength, US-Japan trade woes
USD/JPY regains traction and climbs above 147.00 in Asian trading on Wednesday. US President Trump's latest tariff threats unnerve markets and prop up the haven demand for the US Dollar, aiding the renewed upside in the major. Further, the pair benefits from the US-Japan trade stand-off as it undermines the Japanese Yen.
Gold: More downside in the offing as tariff talks, Fed Minutes loom
Gold price is battling $3,300, licking its wounds early Wednesday. Traders refrain from placing fresh bets on the bright metal, awaiting fresh trade updates and the Minutes of the US Federal Reserve June policy meeting for fresh directives.
Cronos surges 20% on inclusion in Trump Media's Blue Chip ETF
Crypto.com's native token Cronos saw double-digit gains on Tuesday following Trump Media and Technology Group's filing with the Securities & Exchange Commission to launch a Blue Chip exchange-traded fund.
New US tariffs target Asia, but some countries stand to gain
President Trump’s new tariffs are higher than expected for most Asian economies. Moreover, most countries will face additional tariff rates on transshipments. The new announcements are silent on Singapore, India and the Philippines, which might stand to benefit from tariff concessions if negotiations progress favourably.
Best Brokers for EUR/USD Trading
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.