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It would watch for asset bubbles and other dangers to the financial system.
After years of denial central banks are finally coming around to recognise that they must take responsibility for asset bubbles that can wreak economic havoc.
One effect of the Fed's actions is to drive the dollar lower against other currencies, making American products more competitive and perhaps laying the groundwork for asset bubbles elsewhere.
The finance ministers agreed on Tuesday to create agencies overseeing insurance, banking and market trading, as well as a European Systemic Risk Board to watch for asset bubbles and other dangers to the financial system.
The week's declines in precious metals probably came as little surprise to Soros, who implied he thought gold was in danger of dropping as far back down as January last year's price, telling the Davos Economic Forum: "When interest rates are low we have conditions for asset bubbles to develop, and they are developing at the moment.
Similar(55)
Brazil and other nations are already warning of "asset bubbles" — rising prices for real estate and other investments — that could create conditions similar to those that led to the bust in the United States three years ago.
1. Macro-economic environment (3) The risk that economic conditions could damage banks, for example through uncertain recovery or the growth of asset bubbles 2.
At the same time, property prices have fallen for a five consecutive months, easing concerns about the formation of asset bubbles.
Job growth has been anemic for the past decade because it has been based on the servicing of asset bubbles.
Soaring inflation and a fear of asset bubbles, especially in housing, pushed the Chinese government to raise rates for the first time in three years on October 19.
Everyone will be more cautious of asset bubbles.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com