Soaring government debt could roil global financial markets, warns BIS head

Governments should ‘accept that interest rates may not return to the pre-pandemic ultra-low levels’, Carstens said. Photograph: Edgard Garrido/Reuters

Rising government debt levels could disturb global financial markets, the head of the body that advises central banks said on Sunday before France’s high-stakes parliamentary elections.

Agustín Carstens, the general manager of the Bank for International Settlements (BIS), said the world economy was on course for a “smooth landing” from the inflation crisis, but he warned that policymakers, especially politicians, needed to be careful.