FIGURE 2: DAILY CHICAGO BOARD OPTIONS EXCHANGE VOLATILITY INDEX SEPTEMBER 2024 TO SEPTEMBER 2025
Source: Federal Reserve Bank of St Louis. https://fred.stlouisfed.org/series/VIXCLS#
(see figure 2). While public actors are fuelling instability and uncertainty, private actors bear the costs of global economic instability (for example, due to supply chain disruptions). Private credit has grown along with public debts, especially in emerging econo- mies, leading to a higher level of risk accumulation that can affect growth in the coming years. High volatility and uncertainty in traditional financial markets dis- incentivise access for risk-averse investors, while risk lovers can accu- mulate higher risks and yields. In some markets there are signs of pricing inef- ficiencies due to the exploitation of privileged information and regulatory arbitrage. Cyber finance and decentralised financial markets represent a small share of global markets and lack con- trol and supervision. But they are probably the market segments with higher (and undisclosed) returns. Most G20 members have adopted a preventive and constructive approach to digital markets, but data standardi- sation has not been implemented, and market manipulation and insider trad- ing are not infrequent. Unfortunately, the solution to the global economic issues still seems far off, given the lack of the political will to address them. G20 leaders at their
Johannesburg Summit should act to reduce the geopolitical instability and trade uncertainty by strengthening mutual relationships, not only those at the bilateral level. These tasks are dif- ficult to manage, but a few countries (such as Canada, Mexico and China) are paving the way towards a different global economic order. “G20 leaders at their Johannesburg Summit should act to reduce the geopolitical instability and trade uncertainty by strengthening mutual relationships”
// CHIARA OLDANI Chiara Oldani is a professor of monetary economics at the University of Viterbo ‘La Tuscia’ and the director of the Rome office of the G20 and G7 Research Groups. Her research focuses on financial innovation and stability.
X-TWITTER @ChiaraOldani
51 globalgovernanceproject.org
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