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K-Shaped Recovery in Emerging Markets Sees Rich Get Richer

  • Equities, currencies in wealthy EMs tend to outperform: study
  • Correlation between GDP per capita and stock return is 42%
Updated on

Emerging markets are being split apart by an increasingly K-shaped recovery.

Stocks and currencies from wealthier developing nations have outperformed their poorer peers since the coronavirus outbreak. The gulf may even get wider if the pandemic leads to deeper recessions in the most disadvantaged countries.