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Our outlook for emerging markets remains cautiously optimistic given gradual, if uneven, GDP growth and slowing inflation. But conditions are fluid, and differences exist within and across regions.
Moody’s Ratings experts discuss the fragile recovery and new threats in EMs, including macro conditions, default trends, credit risks for sovereigns and corporates, and bright spots.
Macroeconomic conditions will support banks’ loan quality in most EMs. But risks will remain elevated in Egypt, Nigeria and Turkiye, mainly from exposure to weak sovereigns and high interest rates.
Fiscal, social and political issues facing sovereigns can affect GRIs’ standalone credit strength and likelihood of receiving extraordinary support in times of stress, especially in emerging markets.
Stronger investor appetite will allow most to refinance at affordable rates. But sentiment swings and persistently high interest rates remain liquidity and affordability risks for weaker sovereigns.
Growth is generally positive for EM debt issuers because it provides an alternative source of financing without foreign-exchange risk, especially for those that cannot access the cross-border market.
Join Scott Phillips, head of EM at Moody’s Ratings, and Maciej Woznica, portfolio manager at asset management firm Coeli, for a tour of the least-developed emerging markets.
EM sovereign and corporate default rates are decreasing as macroeconomic conditions improve unevenly and financial conditions loosen
We have revised our aggregate EM forecast up slightly to 3.9% for 2024-25 to reflect faster-than-expected growth in some of the largest EMs so far this year. Disinflation continues but is slowing.
The creation of a coalition government following 29 May elections will likely support broad policy continuity and reforms, but the risk of government instability and ineffectiveness is significant.
Moody’s Ratings experts discuss the fragile recovery and new threats in EMs, including macro conditions, default trends, credit risks for sovereigns and corporates, and bright spots.
Brazil is managing higher growth thanks to contributions from agriculture, services and households but the government is facing ongoing risks, including fallout from devastating floods.
Debt-funded capital spending will increase renewable energy companies’ leverage over the next three years. But the stable regulatory environment and policy support facilitate the energy transition.
Continuity, especially a focus on infrastructure spending and domestic manufacturing, will support robust GDP growth. But delays to more far-reaching reform could impede fiscal-consolidation progress.
Sheinbaum's landslide victory gives her a strong mandate to govern, but policy uncertainty raises questions over the outlook for trends that have begun to erode Mexico's credit quality.
Banks and the bond and equity markets support domestic liquidity in India. But offshore financing will remain important for nonfinancial companies' fundraising efforts amid high financing needs.
Slowing economic growth and an approaching peak in fuel consumption amid rapid adoption of alternative fuel vehicles will slow China’s demand for crude oil.
Credit risks evolve in China amid a structural economic shift, protracted adjustment in the property sector and changes in the regulatory and geopolitical environment.
Islamic Finance is an important part of global capital markets in view of the rising demand in the Middle East and Asia. The sector seeks to encourage investment and financing that conforms with the ethical and moral principles of the Islamic faith.
Moody’s Global Emerging Markets virtual event will delve into the complex dynamics of emerging markets in 2024 and identify credit opportunities across the globe.
Join us at Moody’s flagship corporate credit event as we navigate the interplay of sustainability, recovery potential, and liquidity amidst higher-for-longer rates in the dynamic credit landscape of Asia's emerging markets.
Join us at Moody’s flagship corporate credit event as we navigate the interplay of sustainability, recovery potential, and liquidity amidst higher-for-longer rates in the dynamic credit landscape of Asia's emerging markets.