yes in an unusually tight spot due to the rapid, significant increase in interest rates (risk-free yield elsewhere) vs what they can offer to depositors - risking bank runs, which previously have been rare.
If we zoom out, we could say it's a fairly inevitable second order effect of the last ~15-20 years - large deficits, low rate environment and money printing. As debt builds up, the system becomes fragile over time, and events like pandemics or wars (supply shocks, huge fiscal/monetary pump) can surprise, with a sudden spike in inflation.
This has forced central banks to swiftly reverse course and hike rates much faster and comparatively higher (from 0% starting point) than in a long while.
Problem is, when economy participants are hooked to low rates over decades, these hikes will likely break things - starting with banks, then commercial real estate, then who knows what.
Central banks can only hope inflation comes down fast before the dominos start falling - but it's not guaranteed it will, or that it will stay low, especially if central banks are forced to intervene with more easing in the event of some kind of crisis.
If we zoom out, we could say it's a fairly inevitable second order effect of the last ~15-20 years - large deficits, low rate environment and money printing. As debt builds up, the system becomes fragile over time, and events like pandemics or wars (supply shocks, huge fiscal/monetary pump) can surprise, with a sudden spike in inflation.
This has forced central banks to swiftly reverse course and hike rates much faster and comparatively higher (from 0% starting point) than in a long while.
Problem is, when economy participants are hooked to low rates over decades, these hikes will likely break things - starting with banks, then commercial real estate, then who knows what.
Central banks can only hope inflation comes down fast before the dominos start falling - but it's not guaranteed it will, or that it will stay low, especially if central banks are forced to intervene with more easing in the event of some kind of crisis.