-
Financial stability outlook remains fragile as macro-financial conditions weaken, ECB finds
Financial markets remain exposed to adverse macro-financial and geopolitical developments, potentially amplified by vulnerabilities in some non-bank financial institutions Full impact of tighter financial conditions on real economy yet to be felt Higher borrowing and debt service costs will increasingly test resilience of euro area households, firms and governments Euro area banks see profitability benefit from rising interest rates but face headwinds from higher funding costs, worsening asset quality and lower lending volumes According to the November 2023 Financial Stability Review, which was published today by the ... (full story)