Amid an extended period of accommodative monetary policy, the very low cost of borrowing has contributed to unprecedented sovereign and corporate debt issuance over the past decade, and also elevated securities market valuations. Prior to the COVID-19 crisis, some equity market valuations were near peak levels, while well over USD 10 trillion of bonds were trading at negative yields. In addition, corporate leverage is elevated, particularly in non-investment grade corporates in advanced and emerging-market economies. Moreover, while the global financial system is stronger due to G20 financial reforms, weak asset quality and anaemic performance of many banking sectors, as well as growing risks in market‑based finance, have given rise to emerging vulnerabilities that amplified stress amid the impact of the pandemic. As a result, governments and businesses entered the COVID-19 crisis with very low buffers to guard against shocks.