Key Takeaways

  • Emerging markets (EMs) face a challenging growth

    environment as they contend with squeezed real

    incomes, tighter monetary conditions and a still subdued

    global trade backdrop.

  • However, inflation continues to broadly recede across

    EMs and the core measure in particular has cooled over

    recent months and is likely to ease further before the end

    of the year.

  • All this means more EM central banks can begin easing

    cycles before the end of the year, with Latin America

    (LatAm)’s central banks best placed to entrench easing


  • That said, challenges remain for EMs given the potential

    upside risks to inflation, currency pressures and tight

    external financing conditions.

  • As such, we think a pan-EM easing cycle will be delayed

    until 2024, with central banks in Asia being the laggards.

  • We expect most EMs to have begun lowering policy

    rates before the Fed, and cuts to exceed market

    expectations as the easing cycle gets underway in the



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