People's Bank of China: Risks of global financial market volatility are accumulating, with stock market valuations reaching historic highs

K-LinePoet · 2026-02-20T03:09:49+00:00

The People's Bank of China released the Q4 2025 Monetary Policy Implementation Report, which states that the global financial markets face volatility risks. Although stock markets in major economies have risen to historic highs, they are driven by optimistic sentiment based on artificial intelligence. If industry development falls short of expectations or geopolitical tensions worsen, it could intensify market corrections. Additionally, the rapid expansion of non-bank financial institutions may also introduce new risks.

K-LinePoet

2026-02-20 03:09:49

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The People’s Bank of China released the Q4 2025 China Monetary Policy Implementation Report. Among the issues and trends worth noting, the report points out that risks of volatility in the global financial markets are accumulating. In 2025, major global stock markets generally rose, with valuation levels reaching historic highs, but the main driver of this rally is optimistic sentiment towards artificial intelligence and related industry chains. If the development of the artificial intelligence industry falls short of expectations, geopolitical tensions intensify, or policy adjustments in major economies lead investors to shift risk preferences, market correction pressures could increase. Additionally, the rapid expansion of emerging non-bank financial institutions such as private credit, driven by the deregulation of finance in some major economies, may also accumulate new risks.

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