The Treasury Department’s Office of Financial Research flagged cybersecurity and macroeconomic risk as top areas of concern as the cost of cyberattacks continues to rise and uncertainty about COVID-19 and the economic outlook persists.
In its annual report to Congress, OFR noted that expenses required to guard against cyberattacks continue to rise. “The U.S. led the world in the average cost of data breaches at $9.05 million, up 5% year-over-year,” OFR said. “That is more than double the $4.24 million global average cost.” One factor driving up the cost of data breaches is the rising downtime companies face following successful cyberattacks; victims have an average of 23 days of downtime after a successful ransomware attack, the report noted.
Meanwhile, macroeconomic risk remains heightened due to the uncertainty remaining regarding the continuing effects of the coronavirus, OFR said. The report warned that “COVID-19 variants may continue to emerge, potentially threatening to derail the ongoing recovery,” adding that if global increase in prices persists for longer than anticipated it could lead to a faster than expected rise in interest rates.
OFR also raised concerns about climate change but added that its potential risk to the financial system is still difficult to identify and forecast. “Climate change is expected to have a large and diffuse impact on various regions of the country, but at this point, it is difficult to assess how climate change will ripple through the economy and, in turn, the financial system,” OFR said.