Elevated Stock Valuations, Low Risk Premiums In Bonds Remain Key Risks, OFR Says

The government agency tasked with analyzing financial markets says elevated U.S. equity price valuations, low risk premiums in U.S. government bonds, weakness in U.S. corporate credit fundamentals, and fragile liquidity in some securities markets remain key risks. The U.S. Office of Financial Research, which is part of the Treasury Department, said the overall threat to financial stability remains "moderate," in its update from six months ago. OFR says it's concerned about increased risk taking in a climate of persistently low interest rates. A senior Federal Reserve official, Jerome Powell, on Tuesday suggested stock market valuations were not particularly elevated.