The International Monetary Fund (IMF) has sounded the alarm on global financial stability due to the increasing strains from Donald Trump's trade war, highlighting significant risks in their latest report. With global growth forecasts downgraded, the IMF pointed to vulnerabilities such as high valuations in stock and bond markets and the rising leverage among financial institutions. They stressed the potential for economic shocks, especially for emerging economies, as trade uncertainty persists. The report also flagged concerns about nonbank lenders, whose lighter regulation could pose serious risks to the financial ecosystem.
The International Monetary Fund has warned that the global financial system is under increased strain due to Donald Trump's trade war, highlighting significant risks to global financial stability.
The IMF cautioned that economic policy and trade uncertainty have reached an all-time high, predicting further shocks and corrections in asset prices that could tighten financial conditions.
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