Is another EM crisis on the horizon?

16.04.2020 21:45 - Schroder Investment Management (Switzerland) AG (LUX & CH)

Is another EM crisis on the horizon?

Craig Botham analyses the risks posed by US dollar strength for emerging market economies.

Alongside the human toll, only now beginning to climb in many emerging markets (EM), the coronavirus pandemic poses another crisis risk for EM. A global flight to safety, damaging to all risk assets, entails additional macroeconomic risks for economies heavily reliant on US dollar financing. While all economies are under stress at this moment, EM economies face additional unique pressures to which their developed market peers are not subject.

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