The U.S Federal Reserve has noted increasing prices of risky assets as economic recovery accelerates. Fed says valuations are also generally high.
Broad equity market indexes are at record highs.
Corporate bond and leveraged loan yields are at low levels compared to their historical ranges.
Although long-term Treasury security yields have increased in the last few months, they are low by historical levels.
Measures of risk compensation for the low interest rates have declined to levels below historical standards.
Parameters of commercial real estate valuations are high although a decline in transactions for some properties could mask falls in commercial property values.
Farmland prices are high relative to incomes and rents while house prices have persistent amid robust home sales.
Fed expects asset prices to be vulnerable to major declines if the risk appetite of investors falls, and limited progress is made in virus control, or recovery does not pick up speed.
SPY is up 0.14% on premarket, QQQ is up 0.16% on premarket, EURUSD is up 0.16%
