Emerging Markets Economics Update No getaway from tourism woes for some time Particularly weak recoveries lie in store for tourism-dependent emerging markets, including much of Africa, parts of the Middle East (e.g. Jordan), and South East Asia (e.g. Cambodia). A lacklustre... 29th March 2021 · 3 mins read
Emerging Markets Economics Update Lessons from the latest EM rate decisions The raft of EM central bank decisions over the last couple of weeks suggests that the door has largely closed on further rate cuts and that the balance will shift (slightly) towards hikes over the... 26th March 2021 · 3 mins read
Emerging Markets Economics Update EM contagion risks from Turkey look limited The latest crisis engulfing Turkey will make it harder for the country to roll over its external debts, with the banking sector particularly vulnerable. If Turkey’s crisis worsens, it may cause... 22nd March 2021 · 3 mins read
Emerging Markets Economics Update Revisiting financial repression in EMs The recent rise in EM sovereign bond yields will, if sustained, make public debt problems in some countries even worse. Those with large local currency debts may ultimately turn to financial... 18th March 2021 · 3 mins read
Emerging Markets Economics Update Emerging Market Capital Flows Monitor Portfolio outflows from several EMs have intensified over recent weeks as fears over a re-run of the “Taper Tantrum” appear to be playing on investors’ minds. But outflows are currently much smaller... 15th March 2021 · 3 mins read
Emerging Markets Economics Update Are we about to see a wave of EM rate hikes? Recent currency falls and rises in inflation have all but guaranteed interest rate hikes in Turkey and Brazil next week, and Russia’s central bank is likely to lay the groundwork for tightening too... 11th March 2021 · 3 mins read
Emerging Markets Economics Update Rising bond yields and the threat to EM debt burdens The rise US Treasury yields poses a risk for those EMs with large external financing needs such as Turkey as well as some smaller frontier markets, and could force central banks in these countries to... 10th March 2021 · 4 mins read
Emerging Markets Economics Update Manufacturing PMIs still point to further EM recovery February’s manufacturing PMIs released across the emerging world were the proverbial mixed bag but, taken together, generally point towards solid EM industrial production growth in the next month or... 1st March 2021 · 3 mins read
Emerging Markets Economics Update Macro fallout from market rout limited so far Despite the rise in EM bond yields over the past week, EM financial conditions remain very loose. Most central banks are likely to look through the accompanying sell-off in currencies (indeed, some... 26th February 2021 · 3 mins read
Emerging Markets Economics Update EMs and Biden’s American Rescue Plan President Biden’s fiscal plan would support the US economy but the positive spillovers to emerging markets via trade are likely to be surprisingly limited. We doubt the Fed would move more quickly to... 25th February 2021 · 3 mins read
Emerging Markets Economics Update Learning from Israel’s success Israel’s rapid vaccination programme has allowed the government to set out plans to re-open the domestic economy in the coming weeks and may offer some lessons for other countries. The speed at which... 19th February 2021 · 7 mins read
Global Economics The implications of sustained travel restrictions Taken alone, prolonged restrictions on international travel would do little to hinder the global recovery since overseas tourism is a small share of world GDP and some of the lost spending would be... 18th February 2021 · 4 mins read
Emerging Markets Economics Update What the latest oil price rise means for EMs The latest rise in the price of oil – and our view that it will increase further this year – could push current account and budget balances into surplus in many of the EM producers. It should ease any... 17th February 2021 · 3 mins read
Emerging Markets Economics Update Three key points on the risks of another taper tantrum We do not expect a re-run of the 2013 “taper tantrum”, in which EM assets went into a tailspin and some EM central banks were forced to hike policy rates. But even if there were a similar period of... 16th February 2021 · 3 mins read
Emerging Markets Economics Update EMs: why this recovery will be different The recovery in many emerging markets after the Global Financial Crisis was characterised by concerns about destabilising capital inflows, overheating, and asset price bubbles. This recovery is likely... 12th February 2021 · 3 mins read
Emerging Markets Economics Update Recovery in EM portfolio flows may already be fading Net portfolio inflows into many emerging markets reached multi-year highs towards the end of 2020, which allowed a handful of central banks to lean against the wind and accumulate FX reserves. That... 10th February 2021 · 3 mins read
