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Markets

Bundesbank says German banks may be under-estimating risks

German central bank out with their latest stability review 16 Nov

  • German banks robust but suffer from weak profitability
  • may be under estimating the risk of falling asset prices or rising interest rates
  • the solvency and liquidity of German banks are not in doubt
  • Property price have risen sharply since 2010, but nothing suggests lending is excessive or lending standards are weakening
  • another concern is that banks are issuing loans with longer maturities, locking in interest rates and making the sector less flexible in responding to rate changes.

Bundesbank Vice President Claudia Buch says:

"In the current macroeconomic setting, there is the danger that market participants might underestimate risks and fail to adequately take into account the possibility of asset prices falling and interest rates rising"

Meanwhile EURUSD pulling further away from 1.0700 and now challenging 1.0730 offers

EURGBP trying to chew through fresh offers between 0.8600-05 and that's capping cable

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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