Emerging Markets: Prospects and Challenges


Tryggvi Gudmundsson ; Vladimir Klyuev ; Leandro Medina ; Boaz Nandwa ; Dmitry Plotnikov ; Francisco Schiffrer ; Di Yang

Publication Date:

February 18, 2022

Electronic Access:

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Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.


This article documents recent developments in emerging markets in the context of the COVID-19 pandemic, assesses their prospects and challenges, and discusses appropriate policy settings for the medium term. It argues that EM policymakers’ ability to grapple with an incomplete and uneven recovery will be constrained by high public debt and uncertain inflation prospects as well as external risks surrounding capital flows and exchange rate developments. The paper also discusses potential impact of a tightening in global financial conditions and appreciation of the US dollar that could be triggered by a general increase in risk aversion or a reassessment of the likely path of US monetary policy.


Working Paper No. 2022/035




Publication Date:

February 18, 2022



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