IMF Warns Markets May Be Underestimating Geopolitical Risks

The IMF highlights a disconnect between low market volatility and rising global tensions, cautioning against potential financial shocks.

Near-term global financial risks appear contained, but monetary policy easing could lead to asset price bubbles.
The IMF's Global Financial Stability Report points to potential market shocks due to geopolitical uncertainties and upcoming elections.
Military conflicts and unclear policies from newly elected governments are increasing economic uncertainty.
Central banks are urged to communicate clearly and cut rates gradually to manage investor expectations.
Rising use of AI in finance could boost efficiency but also heighten market volatility and operational risks.