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Hardy: The confidence crisis in emerging markets
A big fall in emerging market currencies could continue and the fundamentals are there for this to become a real crisis. So says Saxo's Head of FX Strategy, John Hardy. It's all being driven, he says, by growing concerns about the deficits many of these countries have and how far the US Federal Reserve will continue to "taper" its bond buying programme.
It's a big questions of confidence, says John, and so long as flows continue to head out, this weakness could continue for some time. There's a chance that we could see some peak in the near term if the market's able to find some sort of confidence post this week's meeting of the FOMC. There's speculation that the Fed will further reduce its QE purchases when it meets for two days beginning January 28th.
01:57 minutes
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