The financial markets are still toying with what recent elections in Europe may mean.
Inconclusive elections in debt ridden Greece and the election of a Socialist President in France are all part of the mix of a fragile economic situation in Europe.
Delivering his Financial Stability Report, Reserve Bank Governor Allan Bollard says if global growth falters then it could affect commodity prices, which will impact on New Zealand and Australia.
"We had to come to terms with the fact that there will be continuing periods of fragility and worry around Europe, and they are going to crop up and are likely to crop up for the next while, and these are classic examples."
Photo: Newly elected French President Francois Hollande