The fear of contagion is stalking emerging markets again, but Argentina and Turkey have put themselves in the firing line while others have distanced themselves from it. The shakeout in emerging markets sparked by the “taper tantrum” of 2013 put the spotlight on countries with relatively wide current-account deficits. But many other nations have narrower current-account deficits than in the past, having taken account of what happened in 2013. In Latin America, current-account deficits for Mexico and Brazil are forecast at less than 2% of GDP in 2018. The Turkish lira has been a volatile currency in emerging markets due to a tense political and economic climate inside and outside Turkey.

Source: Wall Street Journal May 16, 2018 10:18 UTC