Home » S&P: Emerging market growth is slowing

S&P: Emerging market growth is slowing

by admin

With few exceptions, GDP growth in major emerging market (EM) economies slowed in the second quarter as the post-pandemic recovery slowed in most emerging markets. S&P Global Ratings expects this trend to continue due to inflationary pressures on households’ real incomes and the worsening external scenario. S&P also expects further downside growth risks, especially in the EM EMEA region, which is subject to the risk of raw material supply disruptions and economic recession in Western Europe.

S&P notes a certain attenuation of overall inflation in several emerging countries; however, core inflation is rising, indicating a possible persistence of the current price scenario. Commodity prices have largely fallen but still remain at high levels.

Supply chain pressures have also eased to some extent, but the implications of China’s zero-Covid policy will likely put global supply chains at risk in the near future. Current external and price developments are driving central banks to raise interest rates and, with the exception of some economies, S&P expects monetary tightening in emerging countries to continue.

Funding conditions remain challenging and S&P expects EMs to continue to face a challenging environment for the foreseeable future. While EM spreads eased slightly in August, yields started to rise again due to more unfavorable statements from the US Federal Reserve. Its restrictive stance and subsequent strengthening of the US dollar will continue to be a barrier to EMs, as approximately 80% of their corporate debt maturing until 2023 is in dollars.

See also  The mortgage interest rate in Beijing, Shanghai and Guangzhou generally fell by 15 basis points, and the first home in many places fell to the lower limit of 4.25%. Industry expectations: the mortgage interest rate in some areas may still have room for reduction-China Quality News Network

You may also like

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

Privacy & Cookies Policy