NEW YORK (Reuters) – BlackRock (NYSE:) on Monday downgraded its view on emerging markets’ local-currency debt to neutral, citing further depreciation risks on currencies that have already weakened significantly since the coronavirus pandemic shut down economies across the globe.
The $6.5 trillion asset manager said that unlike previous crises, where currency weakening was confronted with hawkish policies, this time fiscal and monetary policy is being eased across the board.
“We worry about the ability of many emerging economies to weather a growth shock that is set to exceed that of the global financial crisis in magnitude,” BlackRock analysts wrote in a note to clients.
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