Inflation Control Vital for Avoiding Banking Crisis, Experts Warn

Banks could face losses similar to those seen in the 2008 financial crisis if inflation is not controlled, warns the Bank for International Settlements (BIS) in its annual report. The BIS emphasized the need for the Federal Reserve to bring down inflation to avoid stressing the financial system. The banking failures earlier this year have raised the risk of recession, and experts say more lenders could be teetering on the brink. The Fed has been raising interest rates aggressively to bring inflation down, but commentators warn that getting inflation back to 2% without triggering a recession is unlikely.