European Central Bank sees financial system stress at lowest since crisis started in 2007

BERLIN – The European Central Bank says the overall stress level in the euro area’s financial system has fallen to its lowest level since the early days of the global financial crisis six years ago.

ECB vice-president Vitor Constancio said as he presented the bank’s twice-yearly Financial Stability Review on Wednesday that a composite indicator of systemic stress across major financial-asset classes “is now at the levels of 2007.” He said there has been a consistent improvement since July last year.

However, Constancio cautioned that “the situation in several respects remains fragile.” The bank pointed to risks including turbulence on global financial markets, such as the fallout earlier this year from expectations that the U.S. Federal Reserve would begin trimming its bond purchases.