Why Emerging Markets Are Ready for US Dollar Shock
- About $54 billion in EM hard-currency notes mature this year
- Offcials intervene, ramp up warnings about volatility
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As the dollar’s strength roils developing markets, the good news is that many are now well prepared with piles of reserves for just such a scenario.
More than a dozen emerging-market currencies have tumbled versus the greenback this month, as the Federal Reserve looks poised to keep interest rates higher for longer. The slide has ramifications for the rate path of central banks as well as governments that have to service debt issued in major currencies such as the dollar. About $54 billion in emerging-market hard-currency notes come due in 2024, data compiled by Bloomberg show.