Fed Survey finds global commercial struggle, uncertainty of the most important financial stability risks policy

By Pete Schroeder and Michael S. Derby

The risks of departure from Washington (Reuters) around global trade, the uncertainty of general policy and sustainability of North -American debt exceeded the list of possible risks to the United States financial system in a new Federal Reserve Survey published on Friday.

The Bi-Anual Financial Risk Survey was the first since President Donald Trump returned to the post and the impact of his aggressive policy agenda was evident, especially around the rates. Seventy-three percent of respondents cited the world commercial risks as the highest concern, more than double the number reported in November. Half cited the uncertainty of politics in general as the maximum concern, in addition to the fall.

“ The worry about change in trade policy was the cited risk of this cycle. While many respondents saw the rates as key risk, some said that the national economy could make incremental rates on goods imported with only modest interruption, ” the report added, which he added, “ the respondents considered the potential of a warratory trade war to have more serious consequences. ”

The respondents cited “changes in government spending priorities and the extension of the United States international commitment” as a promoted uncertainty.

The last survey also found more care focused on issues related to the recent market crisis, with 27% of the contacts worried about the treasure markets, up to 17% in the fall. The foreign divestment of the U.S. assets and the value of the dollar also increased the list of concerns.

The Fed said that the “vast majority” of the 22 respondents surveyed, including academics, investors and finance professionals, presented their answers before April 2, the day Trump announced a set of rates on countries around the world. One week later, Trump awaits the most punishment taxes for 90 days, as the administration seeks to negotiate new commercial offers.

The political uncertainty that increased market volatility since Trump returned to the White House was partially compensated by the Fed that found relative stability in several areas.

For example, the Central Bank of the United States said that real estate commercial prices, a long-term concern after the Covid-19 pandemic, showed signs of stabilization. And, while the markets were tensioned in early April, as the liquidity was low in both stocks and treasure bonds, the Fed said that the two markets remained ordered.

However, the Fed warned that even after the sale of April, assets valuations remained relatively high and that residential real estate prices were also high.

The Fed said the US banking system remained solid and resistant as companies had robust capital relations. But it was found that bank credit commitments with fewer regulated banks continued to increase.