Financial Stability Review 2025 highlights persistent risks amid trade‑policy uncertainty. The European Central Bank released a November 2025 review noting that while trade‑policy uncertainty has eased from April highs, it remains a potential source of renewed spikes. Global stock markets have hit new all‑time highs and credit spreads are tight, yet equity markets stay vulnerable to sharp adjustments due to high valuations and concentration. Weak fiscal fundamentals in some euro‑area states, tariff‑sensitive corporate exposure, and growing inter‑linkages with non‑banks could strain banks if markets stress. ECB officials stress the importance of maintaining capital buffers and borrower‑based macroprudential measures to preserve resilience. The review calls for comprehensive policy measures to strengthen non‑bank resilience and support capital market integration.
© European Central Bank, 2025.
Summary derived from the ECB website (https://www.ecb.europa.eu ).
https://www.ecb.europa.eu/press/pr/date/2025/html/ecb.pr251126~4c11ba04d3.en.html
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