Rates risk reverb

Things have got real. Higher rates have triggered a banking crisis, provoking actions from policymakers, investors and bank deposit customers. It’s not a run on the system and it’s not 2008, but the rapid emergence of financial instability is a cause for concern for investors. It worsens the growth outlook and will tend to favour defensive allocations. Certain fixed income strategies should benefit. The end of the rate cycle is (could be) nigh. If things get bad, rates can be cut. After all, there is nothing like a financial crisis to raise the spectre of deflation.