Manage your financial risk

Risk-off activity continued last week as Treasury yields, particularly at the long-end, and the major U.S. equity indices moved lower as investors digested the latest inflation readings and comments from Federal Reserve officials, including Federal Reserve Chair Jerome Powell.

Inflation numbers are hot off the press and exceeding expectations as reports that the price of goods and services rose by 8.3% since last April. Although there is hope that we are falling from the peak numbers seen in March, consumer fears of a recession are growing and permeating the market —...

Banks use back-to-back swaps to meet borrower demand for long-term fixed-rate loans. With back-to-back swaps, the bank enters a floating-rate loan and a fixed-rate swap with the borrower and then a second, offsetting swap with a dealer counterparty.

The upfront costs of interest rate caps have increased significantly in the past six months as short-term rates have risen and expected payouts on these caps have increased in probability and amount. This piece analyzes how cap pricing in the USD interest rate market factors-in expected future...

As volatility roils the commodity markets, corporations face difficult decisions in managing financial risk. For many, achieving long-term success requires dispelling misconceptions and facing uncomfortable truths about the commodity markets and their approach to managing exposures. This article...

Join these introductions to hedging and hedge accounting to gain a foundation for managing financial risk.

In another eventful week packed with a full economic calendar and a high-profile monetary policy meeting, the Treasury curve steepened significantly with the 10-year Treasury yield exceeding 3% for the first time since 2018 as investors grappled with the implications of higher rates for both the...

The Federal Reserve raised the Fed Funds rate by 50 bps, bringing in the largest hike since 2000 in an effort to fight the highest inflation rate the country has seen in 40 years. Job openings and job quits hit record highs in March, while April nonfarm payrolls came in above expectations.