World Risks ‘Scary’ Tightening as Rates Hobbled, JPMorgan Says

Emerging-market central banks are failing to counter rising inflation, risking a “scary” and “synchronized” global monetary-policy tightening as early as next year, JPMorgan Chase & Co. said.

Real interest rates in emerging markets remain at “recession lows” because policy makers believe increases would pressure currency pegs to the dollar and risk exacerbating capital inflows, said chief economist Bruce Kasman in an interview in Beijing today.