The IMF has warned of global financial turmoil due to bank failures that have happened in the US and Europe. The IMF believes that this will spread into equity and other markets. This is a form of contagion that can set into the markets which will cause further problems for central banks across the globe.
The IMF said that banking risks could intensify in coming months amid the continued tightening of monetary policy globally. This is more pronounced as the US Fed has raised interest rates to above 5%, after which 3 US banks have failed.
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