Financial vulnerabilities have declined further across EMs. Our currency crisis risk indicator was at yet another multi-year low in Q3 and sovereign debt risks have eased across large parts of Africa, where our regional indicator is at a four-year low. The result is that EMs are relatively well placed to cope with a rise in US Treasury yields and a stronger dollar that could arise if Trump wins the upcoming US election. Even so, there are still some pockets of vulnerability. Currency risks remain high in those EMs with fragile external positions, including Turkey and Argentina. Banking risks are generally low but rising in many EMs and Russia is now at high risk of a crisis.
To explore the EM financial risk indicators for Q3 in more detail please visit our interactive dashboard here.
Subscriber content
Read this in full, free
Start a free trial and use one of your 10 free starter credits to unlock this piece.