RBA Warns Markets May Be Underestimating Geopolitical and Macroeconomic Risks
The Reserve Bank of Australia has issued a stark warning about complacency in global markets. Assistant Governor Brad Jones highlighted growing evidence of financial fragmentation, particularly in central bank reserve holdings, as a potential early indicator of systemic vulnerabilities.
Speaking at the ASFA conference in Queensland, Jones pointed to selective accumulation of Gold reserves among certain nations as evidence of shifting risk perceptions. "Some of this movement clearly reflects concerns about asset confiscation sanctions," he noted, underscoring how geopolitical tensions are reshaping institutional behavior.
While current fragmentation remains more theoretical than actual, Jones expressed concern about depressed risk premiums across asset classes. Market pricing appears disconnected from mounting macroeconomic uncertainties, creating potential for abrupt repricing events.
