How are financial markets reacting to higher rates, a sluggish economy and geopolitical tensions? Should we worry about property markets?Our host Stefania Secola puts these questions to financial stability expert John Fell on The ECB Podcast.The views expressed are those of the speakers and not necessarily those of the European Central Bank.Published on 2 December 2023 and recorded on 27 November 2023.In this episode:How are financial markets reacting to the new environment of high interest rates, a sluggish economy and rising geopolitical tensions?Banks’ profits are at multi-year highs, yet their valuations haven’t changed much. What factors explain this?Residential and commercial property markets are feeling the impact of higher interest rates. What are the implications for banks and financial stability?As the credit cycle turns, and with several vulnerabilities unravelling, can resilience compensate?Additional material:Financial Stability Review, November 2023 https://www.ecb.europa.eu/pub/financial-stability/fsr/html/index.en.htmlFSR Box 5 on Euro area bank fundamentals, valuations and cost of equity https://www.ecb.europa.eu/pub/financial-stability/fsr/html/ecb.fsr202311~bfe9d7c565.en.html#toc27 Special feature B on Real estate markets in an environment of high financing costs https://www.ecb.europa.eu/pub/financial-stability/fsr/html/ecb.fsr202311~bfe9d7c565.en.html#toc40The ECB Podcast: Financial stability and bank runs, June 2023 https://www.ecb.europa.eu/press/tvservices/podcast/html/ecb.pod230607_episode60.en.html European Central Bank www.ecb.europa.eu