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Reuters / MarketScreener · Quoted expert

Tighter policies hit stocks as EM flows slow in October - IIF

Fortun discusses how tighter policy conditions weighed on emerging-market equities while portfolio inflows slowed in October.

Global Macro Views: Supply Disruptions signal US Overheating

Robin Brooks · Jonathan Fortun · Jonathan Pingle / Institute of International Finance

Exceptionally long delivery times and large price increases in the United States pointed to strong demand as well as supply constraints in October 2021. Robin Brooks, Jonathan Fortun and Jonathan Pingle connect this pattern to unusually large fiscal support. They interpret the disruption as evidence of overheating and retain a 2022 core inflation forecast above the Federal Reserve’s projection at the time.

Global Macro Views: In Defense of Currency Devaluations

Robin Brooks · Jonathan Fortun · Jonathan Pingle / Institute of International Finance

The report reviews large, sustained real currency depreciations since 1980 and their relationship with export volumes, imports and current-account adjustment.

MarketScreener (Reuters) · Quoted expert

Foreign investors fled when Turkey began cutting rates -IIF data

Fortun connects foreign selling of Turkish debt to uncertainty over the lira and rising perceptions of risk after the central bank began cutting interest rates. Reuters also examines how the policy shift interrupted an earlier recovery in foreign equity flows.

Global Macro Views: The Bond Market Sell-Off

Robin Brooks · Jonathan Fortun · Jonathan Pingle / Institute of International Finance

The October 2021 bond selloff differed from the rise in yields earlier that year. Robin Brooks, Jonathan Fortun and Jonathan Pingle find increases spread more broadly across maturities, with a smaller rise in real yields. Greater sensitivity to positive economic surprises suggested renewed focus on recovery and a movement toward, though still short of, conditions seen during the 2013 taper tantrum.

IIF Capital Flows Tracker - October 2021

Jonathan Fortun / Institute of International Finance

This monthly tracker reports September emerging-market portfolio inflows, separating equity and debt investment and identifying the contribution of Chinese equities.

Economic Views: EM Fiscal Tightening Ahead

Jonathan Fortun · Sergi Lanau / Institute of International Finance

Ambitious fiscal consolidation plans faced implementation risks as emerging economies began withdrawing pandemic stimulus. Jonathan Fortun and Sergi Lanau examine planned deficit reductions for 2022 and 2023, including difficult cuts to primary spending. Their September 2021 assessment anticipated delays in several countries, especially where targets implied spending below levels before the pandemic.

Global Macro Views: The EM Terms of Trade Puzzle

Robin Brooks · Jonathan Fortun · Jonathan Pingle / Institute of International Finance

Higher commodity prices were improving exporters’ terms of trade in September 2021 without delivering the currency gains seen after the global financial crisis. Jonathan Fortun and coauthors examine this disconnect in Brazil and other commodity exporters, including Australia. Its breadth challenges an explanation based solely on Brazilian political risk and raises a broader question about why stronger export prices were failing to lift exchange rates.