China’s FX market has grown and changed significantly. This China Spotlight looks into China’s FX market structure and how it shapes the RMB exchange rate.

Country-level ESG scores offer a practical starting point to compare ESG performance across investment destinations; While not a substitute for comprehensive ESG due diligence, ESG scores also help monitor trends over time; Chile, Brazil, and Poland have the top aggregate ESG scores in our sample of emerging markets, reflecting their strong environmental performance, though Poland has more scope to reduce carbon intensity; South Africa, Vietnam, Russia, and India score in the lower range on the ESG factors that we track in our scoring.

We switched to forecasting a Euro zone recession two months ago, … given rising odds of adverse spillovers from Russia’s invasion of Uk...

The May 2022 edition of the Global Regulatory Update provides targeted updates on current workstreams and events.

An embargo by the EU on Russian crude oil and petroleum products would be impactful. While details are still being discussed, we project meaningful volume reductions in 2022. The final impact over 2022-24 will largely depend on Russia’s ability to redirect exports. Sanctions by the U.S. and EU could make a difference as far as third parties are involved. We estimate Russian exports could be $155 bn lower than the baseline over 2022-24. Uncertainty surrounding this estimate is unusually high due to the number of moving parts.

We track EM trade balances as a proxy for current accounts. Imports increased well past pre-covid levels everywhere, … but strong exports prevente...

Portfolio flows to EM stood at -$4.0 bn in April. Equity and debt flows were -$9.5 bn and $5.5 bn. China equity posted $1.0 bn in inflows. ...

China's inbound foreign direct investment was boosted by strong exports and profits in 2021. Both inbound and outbound portfolio flows shrank in...

Across the mature and emerging markets that we cover in our Global Debt Monitor, non-financial corporate debt is at record high of near $90 trillion—over $12.5 trillion higher than pre-Covid levels; Emerging markets recorded more than half of this buildup in non-financial corporate debt—an increase of some $7.5 trillion since 2019. Of note, Chinese corporates have stepped up borrowing even more in 2022; With the Ukraine-Russia war disrupting the global economic recovery, corporate valuations have come under pressure as global funding conditions tighten rapidly; Fully one-third of small-sized firms in mature markets are already having difficulty covering interest expenses.

China’s RMB has fallen sharply against the Dollar recently, … with many flagging parallels with the “step” devaluation in 2...

The May 2022 U.S. Regulatory Update covers Fed Announcements on government-wide crypto activities, ongoing U.S. sanctions in the Russia-Ukraine conflict, proposed requirements related to climate-related financial risk, and more.

Russia stopped natural gas exports to Poland and Bulgaria on April 27. Disruptions should be limited for Poland due to high storage levels, with more diversified sources, including LNG imports, also factoring in. We do not expect spillover effects to other European countries’ supplies. However, Russia’s energy policy is prompting them to seek other sources.

EM ex China outflows since the war began are not unprecedented. In contrast, outflows from China in Q1 were the largest on record, … and were bro...

The April 2022 edition of the Insurance Update provides targeted updates on IIF insurance activities and events.

Despite weak domestic demands, we expect a moderately narrower current account surplus in 2022, due to rising energy prices. Moreover, under the relatively stable headline numbers, the structure of China's current account is undergoing significant changes.