Growth rates in emerging countries tend to be volatile and are affected by what happens beyond their borders. A recent recent study by economists at the IMF (International Monetary Fund) decomposes deviations from trend growth of emerging economies into internal and external factors. The latter include things such as global financing conditions, growth in advanced […]
Deflation Fears in the Euro Area are Overstated
According to Eurostat, the annual inflation rate in the Euro area was only 0.7% in February 2014. A year earlier that same rate stood at 1.8%. This has prompted concerns about the Euro Area slipping into deflation. Deflation is defined as a general decrease of the price level. There have been several such episodes in […]
How large is Latin America’s middle class? 170 or 350 million people?
The subject of Latin America’s middle class has been in the news frequently over the past few years. Together . Therefore Latin America’s middle class is often a hotly debated subject. But how large is Latin America’s middle class? Different studies have yielded a wide range of estimates: anywhere between 170 and 350 million people. […]
Will Labor in the Euro Periphery Soon Be Cheaper than in Eastern Europe?
Every now and then reports on falling hourly labor costs in euro periphery countries surface and make newspaper headlines. Headlines sometimes express falling labor costs as good news, and other times as bad news, depending on who does the interpreting. Falling labor costs may be considered good news because they indicate that it is cheaper […]
Capital controls: the right time to talk about them?
In recent months, a number of emerging countries have been experiencing capital outflows. As expected, these outflows have tended to depreciate the currencies of emerging economies. More importantly, these outflows have also started raising doubts about the resilience of growth rates in the emerging world. Money started flowing out of emerging markets right after Ben […]
