The International Monetary Fund (IMF) has warned that global financial stability risks have increased significantly, driven by tighter global financial conditions and heightened trade and geopolitical uncertainty.
In its latest Global Financial Stability Report released on Tuesday, the IMF said that the tariff announcements made by the United States since February 2025, especially the surprising magnitude of tariffs rolled out on April 2, had triggered a large-scale, global repricing of risky assets and significantly increased volatility in the stock, currency and bond markets.
Major geopolitical events, especially military conflicts, have also exacerbated market stability risks, according to the report.
"Financial conditions have tightened globally and that is to first order driven by the higher level of uncertainty, policy uncertainty around the world. So market volatility has shot up and with the higher market volatility, risk asset prices have declined, meaningfully in equity markets and bond markets. So the tighter financial conditions, the more subdued outlook in terms of real activity and the higher uncertainty means that financial stability risks have increased. And so we do detect the meaningful increase in those downside risks," said Tobias Adrian, director with the Monetary and Capital Markets Department of the IMF.
The report emphasized that during this period full of uncertainties, all countries must remain highly vigilant to prevent small-scale pressures from evolving into widespread systemic crises.
IMF warns global financial risks have increased significantly
China's development has never been a "threat" to anyone but the source of growth advancing common development of all countries, Foreign Ministry spokesman Lin Jian said at a regular press conference in Beijing on Friday.
Some Western media and think tanks are peddling so-called "China Shock 2.0," saying that "China is achieving fast development in high-tech sectors such as renewable energy and AI and relies on foreign markets to absorb its overcapacity, thus reducing the market share of developed countries and sending more serious shock waves to the global economy compared with the era of traditional manufacture industry," while there are foreign commentators saying that the "China Shock 2.0" argument ignores the genuine innovation occurring within the Chinese industrial ecosystem and that Chinese export is the exact booster of the global economy that is needed in the turbulent period and more indispensable than ever.
Commenting on that, Lin said: "From the world's factory to the world's market and innovation powerhouse, China's development is achieved through strong performance driven by innovation and brings tangible cooperation opportunities and space to the world. High-quality Chinese products represented by the 'old three' of textiles, furniture and home appliances have stabilized the global industrial and supply chain, lowered the living cost of global consumers and eased the inflationary pressure worldwide. China's green production capacity represented by the 'new three' of electric vehicles, batteries and solar panels has bridged the gap between supply and demand in global green development and bolstered the global energy transition and low-carbon development. Moreover, China's high-tech products represented by the 'new new three' of robots, AI and innovative drugs have broken high-tech barriers and monopoly and enabled people in more countries to access affordable new technologies," said the spokesman.
"Openness and cooperation bring about progress and win-win result. China's development has never been a 'threat' to anyone but the source of growth advancing common development of all countries. What really creates 'shocks' to the world has never been the innovation of Chinese companies and efficiency of Chinese industrial capacity, but protectionist moves of setting up barriers, decoupling and severing industrial and supply chains. China will stay committed to high-standard opening up, defend the multilateral trading system and provide more certainty and new impetus to the world economy with its own steady development," said Lin.
China's development never a threat: FM spokesman
