We Have Cautious View on EM Through 2018, Says UOB's Heng

The video discusses the current state of emerging markets, highlighting the risks and macroeconomic drivers affecting them. It emphasizes the role of the Federal Reserve's policies and the impact of inflation on emerging market currencies. The discussion includes specific examples from countries like Turkey and the Philippines, where inflation is rising. The video also covers the proactive measures taken by Asian central banks, particularly in Indonesia, to address currency depreciation and current account deficits.

What are the two key macro drivers affecting emerging markets as discussed in the video?

• Decreasing commodity prices and political stability

• High foreign investment and stable currencies

• Strong economic growth and low inflation

• Federal Reserve's interest rate hikes and weak macro indicators

How does inflation impact real interest rates in emerging markets?

• It increases real interest rates, making borrowing cheaper

• It decreases real interest rates, leading to weaker currencies

• It has no effect on real interest rates

• It stabilizes real interest rates, supporting economic growth

What is the inflation rate in Turkey as mentioned in the video?

• 15%

• 25%

• 10%

• 20%

Which Asian countries are highlighted for their proactive measures in managing currency depreciation?

• China, Japan, and South Korea

• Indonesia, India, and the Philippines

• Singapore, Malaysia, and Brunei

• Thailand, Vietnam, and Malaysia

What strategy is Indonesia employing to address its current account deficit?

• Raising interest rates

• Devaluing its currency

• Reducing large-scale imports

• Increasing exports