Even while the American financial system is currently adaptable, current circumstances can give rise to risks that put the stability of the system in jeopardy, according to US Treasury Secretary Janet Yellen.
In response to inquiries in a meeting with a New York today, Yellain said that the “current environment is dangerous and volatile” for the global economy, citing high energy prices and increased fluctuations in the financial markets, and that it is possible to demonstrate risks that endanger financial stability in this environment.
Bloomberg News Agency indicated that recent weeks have witnessed heavy sales of British treasury bonds by investors; This prompted the Central Bank of England to intervene by buying bonds to support them in the market.
The decline in the value of the Japanese yen also prompted the Japanese government to step in and support the domestic currency by pouring in previously unheard-of amounts of dollars to the exchange market.
Yellen stated: “To this day, the American financial system is not a cause of economic upheaval in front of the annual conference of the Financial Markets Union and the US Securities Industry. While we are still monitoring the emerging risks, our system is still flexible, and it continues to work well despite the ambiguity »surrounding the global economy as a whole.
Yellain said that trading in US Treasury bonds, which is the largest standard of standard bonds in the world, is increasing despite its signals to the previous pressure waves that the American bonds were exposed to, noting the continuous work to improve the performance of the American bond market.
Yellen also mentioned possible hazards that could result from an increase in borrowing.
The US Treasury Secretary issues a warning about potential hazards to financial stability.
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