After 2022, “annus horribilis”, 2023 bears witness to a return to grace for emerging debts.
The cocktail of war in Ukraine, soaring inflation and generalized monetary tightening had led to massive outflows of capital.
“
After the peak in liquidity at the start of 2021 post-Covid, there was a very clear tightening last year
”, punctuates Abdallah Guezour, head of emerging debt and commodities at Schroders.
In total, he said, some 100 billion dollars were withdrawn from the emerging debt markets, including 50 billion in local currency.
"
This is a huge amount compared to historical averages, much higher than during the 2008 financial crisis.
"
The trend, which had been reversed for several weeks thanks to a more favorable context, accelerated in early January.
Emerging equity and debt markets attracted $1.1 billion a day last week, according to high-frequency data from 21 countries tracked by the Institute of Finance…
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