Central Banks
Fed Staff Grow Wary of Asset-Price Risks Following Stock Run-Up
- Valuation pressures labeled ‘notable’ at July policy meeting
- Staff say house, CRE prices are ‘high’ based on fundamentals
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Federal Reserve staff have become more wary about the risks that elevated asset prices pose to financial stability after a run-up in the stock market in recent months.
They judged asset-valuation pressures to be “notable” at the Fed’s July 25-26 policy meeting, according to minutes of the gathering published Wednesday. That was a step-up in concern from their assessment of “moderate” risks in May, when they last made a financial-stability presentation to the Federal Open Market Committee.