/ world today news/ It is crucial to improve the financial regulatory system and strictly adhere to the lower limit for low risk, former Chinese Finance Minister Lou Jiwei said at a forum on Saturday, commenting on the recent collapse of US Silicon Valley Bank (SVB). , which sent shock waves through the American banking system.
SVB’s bankruptcy suggests that financial markets have been affected by changes in monetary policy, Lu said at the annual session of the Global Asset Management Forum, of which he is director general. He said the unconventional monetary and fiscal policies undertaken by some countries during the COVID-19 pandemic, have led to high leverage ratios among governments, households, businesses and financial institutions.
These ratios rose quickly but could not fall easily, and this worsened inflation and the impact spread to the global financial market, with increasing volatility in the stock, bond, currency markets, Low Zimwei added, noting that historically it was it is possible to spread the crisis in emerging markets as well.
China attaches great importance to the prevention and elimination of systemic risks and is further improving its financial regulations, including through the recently announced establishment of the Central Finance Commission, which aims to optimize and adjust the functions of regulatory institutions, the former minister said.
He stressed that China will continue to cooperate with other countries on financial regulation to prevent systemic risks to the entire world system.
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