Financial turmoil and changing supervision The current financial market turmoil will speed up developments in the long term, by focusing banks on efficiency and cost control. In the short run the situation may be different. Many rescue packages offered to troubled institutions have been nationally rather than internationally coordinated, which has led to a re-fragmentation of markets.
This softening could be a harbinger of some slowing in the underlying momentum of domestic demand. In the initial estimate released last week, real gross domestic product (GDP) rose at a 2.6 percent annual rate in the fourth quarter of 2018. However, the latest report on retail sales showed a sharp decline.