Risks of withdrawing global equity debated

Global financial stability is at risk as central banks draw back from ultra-easy policies that have flooded the world with cash, because emerging markets lack defences to prevent potentially huge capital outflows, top officials have been warned.

Central bankers from around the world, devoting the second day at their annual Jackson Hole policy retreat to the threats posed by global liquidity, heard two academic papers on the challenges, sparking a debate on actions and on coordination.

Bank of Japan governor Haruhiko Kuroda told the audience, which included top officials from advanced as well as emerging economies, that the bold measures he had championed to spur his nation’s moribund economy were bearing fruit.