Economic activity across the emerging world looks to have moderated since the start of the year, with our GDP tracker pointing to weaker growth in Emerging Europe, Emerging Asia and Latin America. Meanwhile, consumer price inflation remains subdued in most countries, helped in part by weak commodity prices. Against this background, central banks, including several in Asia, but also in Emerging Europe and Africa, have been cutting interest rates over the past month. The only exception is in Latin America, following a rate hike in Brazil. Looking ahead, further interest rate cuts are likely before the end of the year, if as we expect, growth remains weak and falling commodity prices continue to put downward pressure on inflation.
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