EMs to report negative flows for first time since the 1980s

Capital flight from the asset class

Daniel Flynn

The Institute of International Finance (IIF) has said emerging markets could suffer a net outflow of capital this year - the first time since the 1980s - as foreign investor inflows fall to just $548bn.

When combined with accelerating outflows from resident investors, capital outflows could amount to $540bn this year, reported the Financial Times, the first time this has been seen since 1988. This follows inflows of $32bn in 2014. The IIF also estimated that indebtedness at non-financial corporations in EMs has increased more than fivefold over the past decade, reaching a staggering $23.7trn, a concern for many investors around the globe. UK investors return to home shores as equity inflows soar Charles Collyns, the IIF's chief economist, said: "Flows to EMs have weakened sharply i...

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