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FSB Warns of Elevated Global Crash Risk Amid Sovereign Debt Surge
The FSB cautioned G20 nations about elevated global crash risks driven by stretched valuations, rising sovereign debt, and liquidity vulnerabilities in financial markets.
The Financial Stability Board warned of rising risks of a global market correction, citing stretched equity valuations, increasing sovereign debt loads, and lingering geopolitical uncertainty. In its letter to G20 finance ministers, the FSB highlighted concerns around liquidity mismatches in bond markets and vulnerabilities in non-bank financial intermediaries. Analysts said the warning reflects growing anxiety as markets remain sensitive to higher-for-longer interest rates.
The board emphasized the need for coordinated regulatory oversight and improved stress-testing frameworks to mitigate systemic threats.