Macro Roundup (Mar 21)

SHANGHAI, Mar 21 - This is a roundup of global macroeconomic news last night and what is expected today.

The U.S. dollar slid on Monday as investors reacted to UBS’ cut-price takeover of its beleaguered rival Credit Suisse.

The dollar dropped 0.32% to 131.27 Japanese yen, long seen as a safe haven at times of stress.

UBS agreed to buy Credit Suisse on Sunday for 3 billion Swiss francs ($3.23 billion) and assume up to $5.4 billion in losses, in a shotgun merger engineered by Swiss authorities. The U.S. dollar index was last down 0.33% at 103.31 the day after the merger was announced, touching its lowest level since Feb. 15.

Also weighing on the dollar are concerns about regional U.S. banks, despite several large banks depositing $30 billion last week into First Republic Bank, the U.S. lender drawing the most unease from investors. First Republic shares tumbled as much as 50% on Monday and were last down about 39%.

U.S. stock futures rose slightly in overnight trading Monday after the market staged a relief rally on the hope that the banking turmoil would be contained.

Futures on the Dow Jones Industrial Average gained 30 points. S&P 500 futures and Nasdaq 100 futures both inched up 0.1%

Investors now expect a slower pace of tightening from the Federal Reserve in light of the banking crisis. Traders now are pricing in a 77% chance of a quarter-point rate hike when the Fed wraps its two-day policy meeting on Wednesday, according to CME Group’s FedWatch tool. The probability of a pause is at 23%.

Oil prices rebounded and rose over 1% on Monday after diving to their lowest levels in 15 months amid turmoil in the banking sector.

The Brent contract with May delivery last rose 73 cents, or 1%%, to $73.70 a barrel, after earlier hitting $71.64 per barrel at 11:00 London time.

Gold prices retreated from their highest level in a year in volatile trading on Monday, as share markets and Treasury yields bounced back on central banks’ efforts to shore up confidence in the financial sector.

Spot gold last dipped 0.47% to $1,978.66 per ounce, after sliding over 1%, while U.S. gold futures rose rose 0.5% to settle at $1,982.80.

European stock markets closed higher Monday as investors digested news of UBS’s takeover of Credit Suisse.

The pan-European Stoxx 600 index was lower in the first hours of trade before moving into positive territory, and closed 1% higher, with all sectors in the green.