Strong US dollar to increase credit risk for emerging markets: Moody’s
A Moody’s report said a strong dollar would also lead to a drop in foreign exchange reserves of countries such as Argentina, Ghana, Mongolia, Pakistan, Sri Lanka, Turkey, and Zambia.
Chile, Colombia, Indonesia, and Malaysia are not vulnerable in the near term, the report said.
“Countries with large current account deficits, high external debt repayments and substantial foreign-currency government debt are most exposed to the impact of a stronger U.S. dollar,” Moody’s Global Managing Director of the Sovereign Risk Group Alastair Wilson said.
Brazil, China, India, Mexico and Russia are the least vulnerable as they are less dependent on external capital inflows, the report said.