Repricing of securities markets’ risk premia still most significant threat to global financial stability

Abstract

Financial markets saw volatility rise as stock markets underwent a correction in February 2018. Low risk premia and high valuations have increased global securities markets’ exposure to price corrections and abrupt shifts in risk premia. Other risks to global stability that are of particular concern to Finland include vulnerabilities related to the euro area's banking sector and the sustainability of the region's public finances, as well as risks associated with Sweden's housing market.