Reserve Bank of Australia official warns that preparation is needed to deal with a fragile financial system

Golden Ten Data reported on June 17 that a senior official from the Reserve Bank of Australia stated on Wednesday that as the tense geopolitical environment reshapes financial and economic ties, Australian institutions need to be prepared for a more shock-prone financial system. Reserve Bank of Australia Deputy Governor Brad Jones said: “We have to accept the world as it is, not as we would like it to be. It is against this backdrop that policymakers are stepping up efforts to ensure the financial system can withstand a more challenging risk environment.” Jones pointed out that foreign investment accounts for a high proportion of Australia’s fixed income market, which means the country’s financial system will not be immune to external shocks. Speaking about pension funds, he said: “About half of the assets in our superannuation fund industry are invested overseas.”