Data from the Institute of International Finance showed that Emerging Markets It suffered for the fourth consecutive month from the exit of foreign investment portfolios in June, in the longest losing streak in seven years, at a time when fears of recession and inflation are alarming investors.
And the month of June witnessed the exits of non-resident portfolios, amounting to 4 billion dollars, according to the data published today, Wednesday, compared to the value of exits, which amounted to 5.1 billion dollars in May, in contrast to streams It entered emerging markets with a value of $55.8 billion in June 2021.
The current exit scenario is similar to a series of exits Over a four-month period that ended in October 2015. Net exits over the past four months amounted to $27.8 billion, according to the Institute of International Finance.
“We are in the midst of a global interest rate and hyperinflationary shock,” Jonathan Forton, an economist at the Institute of International Finance, said in a statement. “Long-term government bond yields have risen sharply in advanced economies, tightening financial conditions, putting pressure on growth, and heightening risk concerns.” This mechanism negatively affects flows to emerging markets.”
The June exit of $19.6 billion from equity portfolios in emerging markets excluding China was the largest in any month since March 2020, when markets panicked as the COVID-19 pandemic began.
(Archyde.com)