(AP) IMF says monetary easing could drive asset bubble
International Monetary Fund officials say they are watching carefully for signs that massive flows of cash unleashed in world markets by unprecedented monetary easing might lead to asset bubbles, or to overheating in some emerging markets.
IMF Deputy Director Naoyuki Shinohara said Friday that the fund was paying close attention to the risk of overheating in some economies.
Cash added to the global economy from monetary easing in the U.S., Japan and Europe is affecting currency values and fueling investments in commodities, property and other assets.
Shinohara told a seminar in Tokyo that while there are some “warning signs,” they were not enough to set off alarm bells, though another official, Yuko Kinoshita, said that if asset prices rise too high there could be a serious boom and bust cycle.