Global markets show signs of strain as Russia sanctions bite
Flight to safe havens is starting to create tensions in dollar funding markets
Global financial markets started to show signs of strain on February 28, including some indications of a tightening in dollar funding markets, as investors digested the implications of tough sanctions on Russia.
“We are definitely seeing markets getting nervous about strains in the USD funding markets,” says Francesco Pesole, FX strategist with ING. “The cross-currency basis is a key indicator: three-month euro-dollar basis has dropped to the lowest since March 2020, which is clearly signalling
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