Global economic activity moderated somewhat as the brisk recovery phase following the global financial crisis turned into a slower and, hopefully, more sustainable recovery. The multi-speed nature of the recovery continues with subdued economic growth and high unemployment in advanced economies, and buoyant economic activity and rising inflationary pressures in many emerging market economies.
The financial risks in advanced economies that might impact on the stability of the South African financial system, and which are discussed comprehensively in the Financial Stability Review, are   vulnerabilities in the euro area;    banking-sector vulnerabilities;    negative sentiment and declining prices in real-estate markets in a number of advanced economies; and    a broadening of the concept of global imbalances as trade, fiscal and investment imbalances have increased.