Greater commercial and geopolitical uncertainty, as well as more restrictive financial conditions have triggered the risks for global financial stability, warned Tobias Adrian, director of the Department of Monetary and Capital Markets of the International Monetary Fund (IMF).
At a press conference, he explained that commercial uncertainty has triggered financial risks globally, but specifically, the volatility of treasure bonds and the weakness of the dollar that has been seen in recent weeks do not reflect that investors are abandoned to the US currency, but that a revaluation is being given.
He explained that risks to global financial stability have increased in part because financial assets continue with a very high assessment and increasingly concentrated capital markets; There is also a greater participation of non -banking financial institutions (IFNB) in financing and public debt is close to 100 percent of the gross domestic product (GDP).
Difficult, refinance debt
Capital markets have been increasing
he added.
As for the participation of IFNB, such as private credit funds, they have become more central to channel savings towards investment since 2008, and their link with banks has continued to grow. Although the greatest financial intermediation by non -banking entities positively affects the economy, excessive growth based on indebtedness with traditional banks can cause both types of lenders to be more susceptible to possible risks of infection
he explained.
And, on the other hand, sovereign debt levels continue to increase. They currently represent 93 percent of world GDP, compared to 78 percent of a decade ago, and financing costs have increased both in nominal and real terms.
The main government bond markets could experience high volatility, especially those in countries with high levels of debt. The most risky emerging markets, whose sovereign bond differential
highlighted the IMF official.