News & Insights
Welcome to the FIA News & Insights, a one-stop resource that includes insights from senior investment professionals on timely market events, their views on the economy and their respective markets. Find updates on the latest media information on Frost Investment Advisors, LLC and the most recent reprints, as well as, archival information for your reference.
Bank Stress Ratchets Up Financial Tightening, but the Service Sector Remains Hot
Feds Scrambling to Solve a Crisis of Their Own Creation
Large, aggressive increases in interest rates like we’ve seen in the past year often have brought about financial disruptions, as witnessed this past week with nervousness in the banking sector. It is difficult to anticipate where the weakness will surface during a Fed tightening cycle, but it is typical to experience fiscal stress as the cost of borrowing and capital rises. The rise in rates from a historically low level has reduced the value of longer-dated assets, causing losses in exposed banks’ securities portfolios.
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