October 18, 2019 / 2:27 PM / a month ago

ECB's Draghi warns of bubble risk in the euro zone

FILE PHOTO: European Central Bank (ECB) President Mario Draghi speaks at a news conference on the outcome of the meeting of the Governing Council, in Frankfurt, Germany, September 12, 2019. REUTERS/Ralph Orlowski

WASHINGTON (Reuters) - There are “mild signs” of overvaluation in the euro zone financial and property markets, creating a risk for stability at a time when the economy is slowing, the European Central Bank’s President Mario Draghi said on Friday.

“The financial stability environment remains challenging, as the global economic outlook has deteriorated,” Draghi told fellow policymakers on the International Monetary and Financial Committee in Washington.

“There are mild signs of overstretched valuations in the euro area in some riskier segments of the financial markets, as well as in real estate markets, with marked differences across regions.”

Reporting By Balazs Koranyi; Writing by Francesco Canepa in Frankfurt; Editing by Alison Williams

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