After a relatively good run, we think EM currencies will generally depreciate over the coming quarters as the US dollar recovers. Heavily managed currencies in high-inflation economies like the Turkish lira and Argentine peso are likely to fall furthest (perhaps 20–25% by the end of next year). Weak balance sheets and rising political risk could weigh on currencies in Hungary, Brazil, and Colombia. At the other end of the spectrum, Asian currencies for the most part look undervalued and should hold up better.
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