The global financial system is vulnerable to shocks amid a recent surge in the price of shares and other assets, Bank of England governor Andrew Bailey has warned.<\/p>\n
Mr Bailey, chairman of the Financial Stability Board (FSB), the fiscal risk watchdog for the G20 group of nations, urged greater multilateral co-operation between nations to help support global financial systems.<\/p>\n
In a letter to G20 ministers, he said that increased debt levels and a failure to fully implement agreed financial reforms would lead to increased vulnerability.<\/p>\n
Mr Bailey cautioned that there could therefore be a \u201cdisorderly adjustment\u201d, which would see asset prices slump from recent highs.<\/p>\n
He said: \u201cWhile most jurisdictions have seen a rebound in financial markets in recent months, valuations could now be at odds with the uncertain outlook, leaving markets susceptible to a disorderly adjustment.\u201d<\/p>\n
It comes after Wall Street stocks dipped at their fastest rate for six months following a strong period of increases.<\/p>\n
Jamie Dimon, the boss of JP Morgan, is among those to have warned that there is a significant risk of a slump in stock valuations in the next six months to two years.<\/p>\n
Ahead of the latest International Monetary Fund (IMF) meeting and global outlook release, Mr Bailey said reforms by the FSB are key to ensuring continued financial stability.<\/p>\n
He said: \u201cThe reforms put in place by the FSB and other standard-setting bodies since 2009 have helped contain the fallout from more recent crises, including the Covid-19 pandemic, Russia\u2019s illegal full-scale invasion of Ukraine and the swift resolution of the 2023 banking turmoil.<\/p>\n
\u201cThe need for such global standards and co-operation is as clear today as it was 15 years ago \u2013 not just to prevent crises but because, ultimately, a resilient system allows for the efficient allocation of capital and supports G20 member economies in boosting growth.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"The global financial system is vulnerable to shocks amid a recent surge in the price of shares and…\n","protected":false},"author":2,"featured_media":498815,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3090],"tags":[25548,936,51,1700,3663,163818,26932,163821,163820,163819,16,15],"class_list":{"0":"post-498814","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-andrew-bailey","9":"tag-bank-of-england","10":"tag-business","11":"tag-economy","12":"tag-financial-markets","13":"tag-financial-stability-board","14":"tag-fsb","15":"tag-global-financial-system","16":"tag-global-outlook","17":"tag-mr-bailey","18":"tag-uk","19":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115372610420116244","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/498814","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=498814"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/498814\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/498815"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=498814"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=498814"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=498814"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}