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What happens after EM currency crises?

Emerging economies whose currencies have fallen by 15% or more against the dollar in a single day – as the Argentine peso did yesterday – have fallen into recession in more than 80% of cases in the last 30 years. Sovereign debt defaults occurred after roughly half of these currency collapses and Argentina is unlikely to be an exception.  

In light of the wider interest, this publication is also being sent to clients of our Emerging Markets Overview service.

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