Summary
Stay ahead in finance with insights on 2024 EM outlook: EM Growth Premium, monetary policy trends, Asia's resilience, and geopolitical risks.
Key Points
- EM Growth Premium
In a weaker global economic environment, EM look more resilient, but with higher fragmentation and divergences among countries.
EM DM growth differential to stay wide in 2024, at its highest level in five years.
- Easier Monetary Policy
Some EM Central Banks have already started their policy easing and there is still room to cut rates.
Moreover, the expected accommodative policy by the Fed is supportive for the EM space. But the inflation battle is not won yet.
- Asia in Focus
In the great reallocation, Asia may be the winner for investment flows .
India’s economic prospects remain bright.
In China, the structural shift and deleveraging will go ahead, with GDP growth slowing to around 3% in 2025.
- Risks to watch
The key risks to watch are the geopolitical risk and significant elections in 2024 (the biggest election year in history). Investors also need to monitor idiosyncratic stories and internal vulnerabilities which could increase EM fragmentation.
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