What's going on?

Tuesday�s inflation figures won�t soothe the poor bruised Federal Reserve (the Fed).

What does this mean?

The Fed was thinking of speeding up interest rate hikes just a few days ago, but the collapse of Silicon Valley Bank (SVB) will have given it pause for thought � and maybe a few pangs of conscience for good measure. After all, the Fed�s record-fast rate hikes helped set up some of the dominoes that toppled SVB. And if that debacle didn�t muddy the waters enough, February�s inflation data has come along to finish the job. On the one hand, the 6% annual rise and monthly uptick of 0.4% were pretty much what folk expected. But on the other, the slowdown in goods inflation seems to be wearing off � bad news, given that�s been a key factor calming inflation over the last few months.

Why should I care?

For markets: Always look on the bright side of life.
Inflation�s still way above the Fed’s 2% target, but there are a few facts the central bank can take comfort in. First off, February’s inflation wasn’t worse than anticipated, which is definitely a relief for policymakers. Secondly, over 70% of the monthly increase in inflation came from accommodation costs � and that could be the silver lining. See, there�s a lag in the accommodation data used to calculate inflation, and real-time measures are already showing that rent�s starting to drop. So the true headline figure is probably lower than 6% � which could give the Fed some breathing room when it comes to future hikes.

The bigger picture: Good news for the big dogs.
The dust that SVB kicked up is settling a little, with US banks � especially regional players � seeing their stocks regain some mojo on Tuesday. But customers are still taking no chances: the top six US banks, deemed too big to fail, have been flooded with panicky cash in the last few days.