Fed Says Persistent Inflation Is Seen as Top Financial Risk
- Hedge-fund leverage rose to historic highs, Fed says
- US central bank releases semiannual financial stability report
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Higher-than-expected interest rates amid persistent inflation are perceived as the biggest threat to financial stability among market participants and observers, according to the Federal Reserve.
“The risk of persistent inflationary pressures leading to a more restrictive than expected monetary policy stance remained the most frequently cited risk,” the Fed said in its semiannual Financial Stability Report published Friday.