Signs of financial stress emerge

The sharp widening in credit spreads over the past few days will have concerned policymakers and - like last year - a forceful response is likely if further signs of financial stress emerge. But while policymakers can address short-term funding pressures, they can't make strains go away entirely. With NPLs also set to rise sharply, this underscores the difficulties that many corporates will have in obtaining financing over the coming years.