Silicon Valley Bank had $209 bln in assets. Its tech-focused clients were hit by a cash squeeze and pulled money from their accounts. To cover the withdrawals, SVB sold bonds in its portfolio at a $1.8 bln loss, caused by the rising interest rates. That worried clients, so they pulled even more money, until the regulator announced it was closing down SVB.

This month the ECB started to reduce its bond holdings as eurozone governments issued about €100bn of extra debt. ECB purchased €5 tln of assets during quantitative easing and €1.7 tln during the pandemic. Not replacing all maturing bonds would reduce its holdings by €25 bln per month, increasing the net bond supply to €700bn, from €150bn last year.

Investments in renewables fall due to rising interest rates and higher materials costs to less than half of the planned $1 trillion a year. Unlike power stations that require fuel, the majority of the cost for renewables comes upfront. This makes the sector sensitive to changes in financing. Higher interest rates affest winds, solar, as well as energy storage.