Economics
Fed's Pause Allows Emerging-Market Central Banks to Exhale
- Pressure lifted off emerging currencies as Powell signals hold
- Emerging-market policy makers jacked up rates in 2018
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The Federal Reserve’s shift to a prolonged pause in its interest-rate hiking cycle will lift pressure off its emerging-market peers to hike in tandem.
Central banks in Chile, Indonesia, Mexico, the Philippines, Russia, South Africa, and Thailand are among those that have raised rates in recent months, some seeking to blunt the dollar’s rise against their currencies. The Fed’s four rate increases in 2018 were a central reason.