Global economy at a pivotal moment: BIS report

NEW DELHI, July 10: The Bank for International Settlements (BIS) has warned policymakers about the fragility of the World economy, BIS termed the situation of the global economic scenario as the “pivotal moment.”
BIS is an international financial watchdog that is owned by member central banks with the main goal of maintaining financial cooperation among central banks to foster global economic development.
In a report released last month, the BIS highlighted that the global economy is prone to the ongoing trade tensions and geopolitical risks. Agust n Carstens ( Currently serving as the General Manager, BIS) pointed out the US-driven trade war and other policy shifts disturbing the global economic order.
The report also highlighted the dire need for structural reforms in the global economy, with increasing investment allocations in digital infrastructure. BIS also highlighted the requirement for a resilient global monetary system for fostering global financial cooperation.
Carsten also termed rising protectionism and trade fragmentation as “particularly concerning” matters, as they are already pushing the decade-long decline of the global economy into bleak prospects.
BIS economic advisor Hyun Song Shin also pointed out the fall in the US dollar. It’s down by the mark of 10% which is the biggest decline since the free-floating exchange rate era of the early 1970s.
The BIS report also takes into consideration Tokenization and AI or artificial intelligence systems in reshaping the world economy. The report named a project ” Promissa” that eases access to the tokenization of promissory notes for multilateral development banks. This move has reduced the cost pressure on central banks and finance ministries.
The BIS report is seen as the wake-up call for policymakers and administrators to adapt to the ever-evolving global financial landscape. The report also highlighted a need to closely monitor the inflationary trends and regulation of NBFIs, or Non-Banking Financial Institutions.
(UNI)

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