What does ECB's Alvaro Santos Pereira consider a top financial risk?

Pereira identifies a steep correction in financial markets and crypto assets as a top short-term risk to financial stability.

Why must central banks preserve room to act, according to Pereira?

Central banks must preserve room to act to be ready to respond if another shock hits the financial system.

What is the priority for the European Central Bank?

The priority for the European Central Bank, as stated by Alvaro Santos Pereira, is price stability.

Home / Business and Economy / ECB Warns: Market Turmoil Top Financial Risk

ECB Warns: Market Turmoil Top Financial Risk

22 Nov, 2025

•

Summary

Steep market and crypto asset correction poses financial stability risk.
Central banks need to retain capacity to respond to future shocks.
Price stability remains the foremost priority for the ECB.

ECB Warns: Market Turmoil Top Financial Risk

Alvaro Santos Pereira, a member of the European Central Bank's Governing Council, has identified a substantial correction in financial markets and cryptocurrency assets as a primary short-term threat to overall financial stability. This warning underscores the precarious nature of current economic conditions.

Pereira, who also serves as the governor of the Bank of Portugal, stressed the imperative for central banks to carefully preserve their operational flexibility. This readiness is essential to effectively manage any subsequent economic shocks that may arise, ensuring a resilient financial system.

He firmly stated that maintaining price stability is the paramount objective for the central bank. This focus is critical in navigating potential market volatility and safeguarding the economic well-being of the region.