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

cycles.

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

US.

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