Financial Stability Board chair Klaas Knot has written to G20 leaders ahead of next week’s meeting to warn that global financial stability is at risk from the combination of high inflation, a strong central bank response, significantly tighter financial conditions and climate change.
Growth has weakened, the Netherlands' central bank governor writes, exacerbated by the war in Ukraine, while the strength of the US dollar has put many emerging market and developing economies under increased strain.
“There is no room for complacency. Current conditions are unprecedented in a number of respects, and we need to be attentive to existing and potential new financial vulnerabilities,” especially from the non-bank financial sector. “These challenges make global cooperation on financial stability matters as important now as it was after the global financial crisis.”
Most global leaders are heading to Indonesia for the meeting, with President's Biden of the U.S. and Xi of China set to meet.( MNI BRIEF: China's Xi To Meet U.S. President Biden At G20)