Emerging Markets Face New Credit-Downgrade Era, S&P Global Warns

The Middle East war risks ending a run of net credit-rating upgrades across emerging markets and could trigger a new downgrade cycle as it fuels inflation and tightens financial conditions, S&P Global Ratings Director Ravi Bhatia said.

The warning comes as an energy shock ripples through developing economies, after disruption along a key oil shipping route sent oil prices soaring, raising costs for energy importers such as India, Turkey and Kenya. Even exporters are bracing for fallout as higher prices globally weigh on growth, stoke inflation and curb tourism.