Large Omicron waves have caused activity to weaken in many EMs in Q1, but the good news is that mobility appears to bounce back quickly once outbreaks subside. As a result, the economic hit is likely to be small and short-lived. Instead, high inflation and tight monetary policy pose a bigger headwind to growth, particularly in Emerging Europe and Latin America.
Drop-In (23rd Feb., 15:00 GMT): We’ll be discussing South Africa’s budget, the risks to the country’s debt profile and the potential impact on FX and bond markets in a 20-minute online briefing on Wednesday. Register here.
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