Neil MacKinnon: EM Interest Rate Cycle Is Changing

The video discusses the challenges faced by emerging markets in defending their currencies, particularly the Turkish lira and Russian ruble, through higher yields at the expense of growth. It explores the changing interest rate cycles in countries like Brazil and Russia, and the impact of commodity prices. The discussion shifts to the global effects of Trump's fiscal policies, known as the Trump reflation trade, and the shortage of dollars affecting emerging markets with current account deficits. Strategies for central banks to address currency weakening are also examined.

What are the implications of defending a currency with higher yields according to the discussion?

How have emerging market policymakers responded to currency challenges in the past?

What factors are contributing to the changing interest rate cycle in emerging markets?

Discuss the impact of the Trump reflation trade on emerging markets.

What challenges do currencies in emerging markets face due to a shortage of dollars?