Latest News

German financial system under strain but property correction not seen: Bundesbank

German financial system under strain but property correction not seen: Bundesbank By Reuters

Breaking News

‘;

Economy 13 minutes ago (Nov 24, 2022 10:11)

© Reuters. FILE PHOTO: Facades of apartment buildings are pictured at Schoenberg district in Berlin, as the spread of the coronavirus disease (COVID-19) outbreak continues, Germany, November 12, 2020. REUTERS/Fabrizio Bensch

FRANKFURT (Reuters) – Risks in the German financial system are building as the economy heads for a recession and struggles with rising interest rates and sky-high energy prices, but a correction in the housing market is not imminent, the Bundesbank said on Thursday.

Europe’s largest economy has been among the top losers of Russia’s war in Ukraine because of its excessive reliance on Russian gas and the economy is now set to suffer a significant downturn starting in the fourth quarter of 2022.

“The macro-financial environment has deteriorated substantially,” the Bundesbank said in a Financial Stability Review. “Major downside risks remain.”

Rising costs, partly a function of higher European Central Bank rates, are limiting the financial leeway of households and enterprises, and this increases future credit risk.

Still, the Bundesbank did not expect a significant correction in house prices, which were in the past seen 15% to 40% overvalued.

“On balance, house prices are still rising, albeit at a slower pace,” Bundesbank Vice President Claudia Buch said. “That said, there are no signs of a severe slump in real estate prices or of overvaluations receding.”

Despite the downturn, the Bundesbank argued that it was not yet time for the country’s financial regulator to release a so-called countercyclical capital buffer – extra capital, built up during better times, to be used up during a slump.

“A worsening energy crisis, a sharp economic slump and abruptly rising market interest rates could put the German financial system under considerable pressure,” the bank added.

Extreme volatility in energy prices sharply increased the collateral requirements of central counterparties in derivatives trading but government measures cushioned the liquidity shortage and the overall supply of credit “has worked well”, it said.

German financial system under strain but property correction not seen: Bundesbank

European shares hit fresh three-month highs after signs of Fed slowdownBy Reuters – Nov 24, 2022

By Sruthi Shankar (Reuters) -European stocks hit fresh three-month highs on Thursday after minutes from the Federal Reserve’s November meeting signalled a slowdown in the pace of…

UK net migration rose to 504,000 in year to June 2022 – dataBy Reuters – Nov 24, 2022

LONDON (Reuters) – Net migration to the United Kingdom rose to an estimated 504,000 in the year to June 2022, official statistics showed on Thursday.
 
 

Dollar nears 3-mth low, shares climb after Fed tests the brakesBy Reuters – Nov 24, 2022

By Marc Jones LONDON (Reuters) – World shares touched a two-month high and the dollar swooped towards a three-month low on Thursday, after Federal Reserve meeting minutes pointed…

Our Apps



Terms And Conditions
Privacy Policy
Risk Warning

© 2007-2022 Fusion Media Limited. All Rights Reserved.

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

What's your reaction?

Excited
0
Happy
0
In Love
0
Not Sure
0
Silly
0

You may also like

Leave a reply

Your email address will not be published. Required fields are marked *

More in:Latest News