The recent sharp falls in emerging market (EM) currencies against the US dollar do not reflect fundamental shifts in exchange rate policy in these countries. Instead the main driver is renewed demand for the dollar as a safe haven from a slowdown in the advanced economies and the reduction in risk appetite caused by the crisis in the euro-zone. Downward pressure on EM currencies is likely to continue for the rest of this year, but those of Emerging Asia should lead a recovery in 2012.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services