Growth in the emerging markets (EM) has deteriorated dramatically recently. Bank of America/Merrill Lynch’s Rates and Currencies Research team of Alberto Ades and Vasileios Gkionakis write that every major EM region has experienced a wave of downside surprises in their economic reports.
However, there may be more bad news to come for these economies.
According to the analysts’ research, the Emerging Market Surprise Index lags EM equity index. And EM equities have continued to fall.
Here’s a chart from BofA:
Photo: Bank of America/Merrill Lynch