STABILITY OF FINANCIAL MARKETS UNDER GLOBAL ECONOMIC INTEGRATION

Abstract

This study explores the impact of global economic integration on financial market stability, identifies the challenges and risks associated with managing financial stability across borders, and provides recommendations for enhancing market resilience. Based on a survey of 222 financial professionals, the research reveals that while global economic integration is generally perceived positively, it presents notable challenges. Specifically, 60.8% of respondents view it as beneficial for market stability, with 22.5% rating the impact as "very positive" and 38.3% as "somewhat positive." However, 19.0% perceive it negatively, and 20.3% remain neutral. The most significant factor affecting market stability is cross-border investment flows, identified by 40.5% of respondents, followed by global economic policies and regulations at 27.0%. Challenges in managing stability primarily stem from regulatory divergence among countries (36.0%), with currency volatility (24.8%) and inconsistent economic data (22.5%) also being significant concerns. The study highlights liquidity risk due to global market fluctuations as the most troubling risk (31.5%), followed by credit risk from international counterparties (27.0%) and operational risk related to cross-border compliance (18.0%). To address these issues, the study recommends strengthening international regulatory cooperation, improving transparency and data sharing among financial institutions, and developing robust risk management frameworks. These measures are intended to mitigate risks and enhance the stability and resilience of financial markets in an increasingly interconnected global economy. The findings offer actionable insights for policymakers, financial institutions, and stakeholders focused on fostering a stable and resilient financial environment.