The hardening of monetary policy in the United States leads to a capital escape from certain developing countries, and avoided the risk of a financial crisis similar to that of 2013.
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These days ago, central bank governors more concerned than others. “The global economy is in the eye of the cyclone,” said that of the Reserve Bank of India at the end of September. Shaktikanta Das has reason to worry: the institution’s reserves located in Bombay have merge $ 100 billion (103 billion euros) since the start of the year, while it bought arm of rupees to stop his fall compared to the greenback.
Since the United States Federal Reserve (Fed) began to raise its rates, in the first half, to fight inflation, capital deserted emerging markets, weakening, in passing, their currencies. Thus, the Ghanaian currency, the CEDI, has lost 41 % against the dollar since the beginning of the year, while the Taiwanese dollar depreciated by 13 %. In Mongolia, the Tugrik sold 16 % of its value, while the central bank’s reserves have decreased by 40 % in one year. Khan Bank, the largest banking establishment in the country, has just announced the cap of conversions into foreign currencies at 300 dollars per month.
“While the world economy is heading towards agitated waters, the time has come for the officials of emerging countries to close the chase”, alerted the chief economist of the International Monetary Fund (IMF), Pierre-Olivier Gourinchas , in forecasts published Tuesday, October 11. During the first three quarters of the year, foreign investors sold in Asia, excluding China, $ 69.7 billion in assets, far beyond the $ 47.6 billion they had yielded to the peak of The global financial crisis of 2008.
International fearful institutions
Bank J.P. Morgan revised upwards its exit forecasts of the capital of intermediate economies in 2022 to 80 billion dollars, instead of 55 billion. “Eleven emerging countries risk a balance of payments for the international monetary tightening,” warns the Carte-Credit Company Allianz Trade, in a note published in early October. Among these countries are Chile, Pakistan, Hungary, Kenya and Tunisia.
These dropouts hover the risk of a financial crisis similar to those that have already shaken the planet. With each tightening of American monetary policy, when liquidity taps close, the financial storm rises on emerging countries, as was the case in spring 2013, or, in 1994, in Mexico. A vulnerability that is both due to their needs for external financing and the domination of the dollar in international transactions and world trade.
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