IMF warns of possible market correction
Withdrawal of central bank support might trigger shock, say Tobias Adrian and Fabio Natalucci
The welcome arrival of Covid-19 vaccines has not eliminated the risk of a severe market shock, the International Monetary Fund says.
Its updated Global Financial Stability Report, published today (January 27), says the ongoing economic recovery and market rally are being propped up by policy support.
But, as noted by IMF financial stability chief Tobias Adrian and deputy Fabio Natalucci, several factors could trigger a sudden market repricing.
“As the apparent disconnect between exuberant
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