Crypto’s Growing Influence in Washington

Financial stability risks remain higher than in recent years due to global uncertainty and underperformance in parts of the New Zealand economy. Trade tensions present risks to our exporters and have affected business confidence. Persistent weakness in the domestic economy is creating challenging conditions for businesses, exposing banks to credit losses. However, financial stress is not uniform across the economy, with lower interest rates and high agricultural export prices supporting some sectors. Banks also have robust financial buffers to absorb shocks. Global economic fragmentation and policy uncertainty present risks to tradingpartner growth. The outlook for trade relations between the US and China remains uncertain. Many central banks are easing monetary policy in response to projected lower growth and lower inflation. Policy uncertainty and a weaker labour market have contributed to softer economic activity in the US. China’s growth outlook has improved, but risks remain. Investors have also become more concerned about fiscal sustainability risks in the US and some other advanced economies. Recovery in global financial markets masks potential vulnerabilities. Global equity prices have rebounded from their lows RBNZ: FRAGMENTATION OF GLOBAL TRADE AND FINANCE, AND ONGOING UNCERTAINTY CONTINUE TO PRESENT RISKS LOAN DEFAULTS HAVE PICKED UP, ALTHOUGH THEY REMAIN LOW COMPARED TO DURING THE GLOBAL FINANCIAL CRISIS BANKS REMAIN WELL PLACED TO MANAGE THE CURRENT UNCERTAINTY STRONG LENDING…