Emerging markets move centre stage

Emerging markets have come full circle. Having been out of favour in the late 1990s, when currency crises in Asia and debt defaults in Russia spooked investors, the asset class finds itself back in vogue. Emerging economies have historically been big borrowers of external capital to finance their growth. In the first half of this year, the heavily indebted economies in Latin America, Asia and Eastern Europe were the biggest beneficiaries of the global environment of low interest rates as investors searched for yield. The Bank of International Settlement observed this earlier in th...