Emerging markets 2023 outlook – A tale of two halves: The MUFG Global Markets Podcast

Distressingly high inflation, elevated interest rates, the war in Ukraine, COVID outbreaks in China and a dominant US dollar dented the performance of EMs in 2022. While EMs continue to grapple with the same themes at the turn of the year, we view 2023 as a tale of two halves.

Ehsan Khoman, Head of Commodities, ESG and Emerging Markets Research (EMEA), discusses MUFG’s emerging markets 2023 outlook. Ehsan writes that the waning effects of market re-openings, a global manufacturing cycle downturn and tighter financial conditions are lumpy headwinds that will weigh on EM prospects in the first half of 2023.

However, China’s zero-COVID policy exit, the end of rate hikes and a US dollar peak, all offer significant tailwinds to the EM complex in the second half of 2023. See here for the full report.

Disclaimer: www.mufgresearch.com (PDF)