ECB Raises Interest Rates Despite Financial Turmoil, Credit Suisse Shares Plummet

On Thursday, March 16, 2023, the European Central Bank held its monetary policy meeting and decided to go ahead with the half a percentage point rise in its base interest rate despite the financial turmoil of the past week.[0] This decision has been met with mixed reactions as the market participants were expecting a rate hike, however, they think that the future hikes are now off the table.[1]

The news of the rate hike sent Credit Suisse’s shares into free fall on Wednesday, with the stock falling by more than 30% before closing down 24%.[2] This followed the announcement that Saudi National Bank, Credit Suisse's largest investor, would not provide the Swiss bank with additional financial assistance.[3] In response to the news, Credit Suisse will now borrow up to 50 billion Swiss francs ($54 billion) from the Swiss National Bank.

The news has sparked concerns of a global banking crisis and has caused panic in the markets.[3] Al Khudairy, the head of Credit Suisse’s investment bank, has urged for calm, saying that the panic is “completely unwarranted”.[2]

Overall, the European Central Bank’s decision to raise its interest rate has caused a stir in the markets, and investors are now watching the situation closely.

0. “Wall Street banks organise a bailout operation as financial crisis deepens” WSWS, 17 Mar. 2023,

1. “How Credit Suisse just unleashed a nightmare decision for the Fed and the ECB” Yahoo News, 16 Mar. 2023,

2. “Credit Suisse was so fragile that a blunt answer in a TV interview was enough to send it to ask the Swiss central bank for $54 billion” Fortune, 16 Mar. 2023,

3. “AMC Fans Mock Credit Suisse as Share Prices Fall Below Meme Stock” Newsweek, 16 Mar. 2023,

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