Almost two-thirds of banking executives believe the U.S. will see its highest interest rates this cycle in the first half of next year. And close to 60% of executives said they are concerned the Federal Reserve is hiking rates too quickly.

Interest rate increases by central banks have compounding effects and could exacerbate weaknesses in the global financial system, Federal Reserve Vice Chair Lael Brainard argued in a speech Friday.

Short-end rates for the first half of 2023 have already leaped higher, bringing market policy-rate expectations in line with those of officials near 4.6%.

Officials forecast that rates would reach 4.4% by the end of this year and 4.6% in 2023, a more hawkish shift in their so-called dot plot than expected.

Federal Reserve Chair Jerome Powell's speech in Jackson Hole reaffirmed that the end of accommodative monetary policy is coming to an end. This is a boon to banks, but only those that have managed their balance sheets just right.

The Federal Reserve released its large bank requirements for 2023 based on the results from this year's stress test. Most of the banks tested will need to maintain or increase their tier one capital holdings.

Markets expect the surge in consumer prices will soon peak and central banks will become less hawkish, but there’s a high risk that global cost pressures will remain elevated.

Fed Chairman Jerome Powell brushed off concerns that rapidly tightening monetary policy could disrupt the financial system. Some economists and policy experts beg to differ, raising concerns about loan defaults or even the collapse of a key institution or counterparty.

The yield on the two-year Treasury moved to be as much as 32 basis points higher than the 10-year yield, which slid in the wake of the Fed’s announcement that it was raising its overnight benchmark by 75 basis points.

Following their largest drop in over a decade one week ago, averages rapidly swung upward as recession talk receded.