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Treasury Watchdog Sees U.S. Financial Market Risks Rising

  • Risks are rising from potential ‘sudden drop’ in asset prices
  • Overall risk are moderate, and system strong than pre-crisis
Pedestrians pass in front of the New York Stock Exchange in New York.

Pedestrians pass in front of the New York Stock Exchange in New York.

Photographer: Michael Nagle/Bloomberg
Updated on

The U.S. agency that analyzes threats to financial-market stability is waving a red flag about elevated stocks and bonds.

Overall, the risks to financial stability remain in the “medium range” and the system is far more resilient than a decade ago during the financial crisis, according to Treasury’s Office of Financial Research, an oversight body that was created by the post-crisis Dodd-Frank reforms. But vulnerabilities have emerged in the past year amid too much borrowing.