Emerging markets currency rout abates as policymakers offer support
Published on Jan 30, 2014 11:21 PM
RIO DE JANEIRO/LONDON (REUTERS) - A sharp emerging market sell-off appeared to subside on Thursday as Latin American currencies opened higher while Russia's rouble and Turkey's lira rebounded after policymakers pledged to take any necessary measures to stabilize their markets.
Investors were on the watch for additional dollar outflows from developing nations but traders said recent panic selling had abated for now as markets digested the US Federal Reserve's widely expected decision to cut bond purchases by another US$10 billion (S$12.74 billion) on Wednesday.
"We do accept the idea that the Fed reducing its asset purchases begins a change in the overall investment climate, but it is really a transition phase," analysts with Brown Brothers Harriman wrote in a research note.
Worries about China's economic slowdown still left investors walking on eggshells as an index of business conditions for Chinese manufacturers dipped for the first time in six months.
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