Fed: Financial sector vulnerabilities will become clearer

The Fed published the May issue of the “Financial Stability Report”, which includes evaluations on the American financial system.

16.05.2020 11:50:000

In the May 2020 issue of the “Financial Stability Report”, the US Federal Reserve (Fed) pointed to the new type of coronavirus (Kovid-19) epidemic and the uncertainty of the economy, “Financial sector vulnerabilities will likely be more pronounced in the short term”. gave his statement.

The Fed published the May 2020 issue of its “Financial Stability Report”, which includes assessments of the current situation in the American financial system.

Emphasizing that the Kovid-19 outbreak and the measures taken against it have brought some economic sectors to a halt since mid-March, it was reminded that the economic activity in the USA contracted at an unprecedented pace and the unemployment rate increased to 14.7 percent in April.

“Disruptions in economic activity at home and abroad significantly affected financial conditions and disrupted the flow of credit,” the report said. was evaluated.

“Financial institutions may suffer”

In the report, which reminded the measures taken against the economic effects of the Kovid-19 epidemic, it was noted that the financial system was still shocked, although the financial reforms implemented since 2008 have increased the durability of the industry.

“Financial sector vulnerabilities are likely to be more pronounced in the short term,” the report said. expression was used.

In the report of the Fed, it was stated that the problems in households and businesses’ balance sheets caused by economic and financial shocks since March will cause fragility for a while.

Warning that financial institutions, including the banking sector, may experience difficulties, the report pointed out the current vulnerabilities and it was stated that asset prices followed a volatile course in many markets.

“The outlook for the epidemic and economic activity is uncertain. In the short term, the risks associated with the course of the Kovid-19 outbreak and its impact on the United States and global economies continue to remain high.” evaluation was included.

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