Global Financial Stability Report, April 2025: Enhancing Resilience amid Uncertainty

Against the heightened volatility of asset prices, Chapter 1 assesses that global financial stability risks have increased significantly. This assessment is supported by three key forward-looking vulnerabilities: (i) valuations remain high in some key markets; (ii) some highly leveraged financial institutions and their nexus with banking systems; and (iii) risks of market turmoil and challenges to debt sustainability for highly indebted sovereigns. Chapter 2 shows that major geopolitical risk events can trigger a significant decline in stock prices and raise sovereign risk premiums, thereby posing a potential threat to macro-financial stability. The assessments and analyses in this GFSR are based on financial market data available to IMF staff through April 15, 2025, but may not reflect published data by that date in all cases.