Central bankers are worried about the potential for a market crash as trade tensions, public debt, and a stock bubble focused on artificial intelligence companies loom. IMF Managing Director Kristalina Georgieva warned of valuations reaching levels seen during the internet bullishness 25 years ago, which could lead to a sharp correction affecting global growth.
Policymakers have been sounding the alarm on high equity valuations, with concerns raised by the Bank of England, European Central Bank, and the Reserve Bank of Australia. The IMF’s Global Financial Stability Report and World Economic Outlook will be closely watched, along with statements from Group of Seven or Group of 20 ministers attending the IMF gathering.
In the US, Powell’s assessment of the labor market and inflation will be key, along with economic data releases such as the small-business optimism index and manufacturing surveys. Canada will focus on home sales and housing start data, while Asia will look at trade, inflation, and policy signals to gauge economic resilience in the face of global uncertainty.
Europe, Middle East, and Africa will see appearances by ECB President Christine Lagarde and BOE Governor Andrew Bailey, with a focus on Germany’s ZEW investor confidence index and euro-zone industrial production. Latin America will monitor Argentina’s economic crisis, Brazil and Peru’s GDP-proxy figures, and Colombia’s economic growth projections.
Read more at Yahoo Finance: Stock Bubble Dread Grips Central Bankers in Washington