Home / Knowledge / News / Textiles / Emerging markets resilient to global risks, says Moody's
Emerging markets resilient to global risks, says Moody's
Oct '15
Moody's Investors Service has said that emerging market sovereigns have diverging shock-absorption capabilities to withstand the risks that will continue to impact global credit quality in 2015-16. Moody's report, titled "Baa-rated Sovereigns: Diverging Resilience to Developing Global Risks," focuses on five Baa-rated sovereigns: Turkey, Brazil, South Africa, India and Indonesia.

The report is an update to the markets and does not constitute a rating action, the agency said.

Moody's believes the main external risk facing emerging markets is the potential for a prolonged period of emerging market risk aversion, prompted by the anticipation of the normalisation of US monetary policy and the possibility of a sharper-than-expected slowdown in China's growth. In some cases, country-specific challenges exacerbates this external risk.

According to Moody's report, the trends in global capital flows have caused Brazil and Turkey to register the sharpest exchange rate depreciation and loss of reserves in the first half of 2015, while India proved comparatively resilient to these market developments.

Overall, Turkey stands out as most vulnerable to external risks because of its high reliance on external capital and large stock of external debt due annually, combined with heightened political risks.

While Brazil is less reliant on external capital, it has already experienced significant financial market turbulence because of the country's weak growth outlook, ongoing deterioration of its fiscal metrics and challenging political landscape.

South Africa and Indonesia are primarily exposed to financial market turbulence through their trade links with China and a period of low commodity prices. If Chinese growth is slower than expected, this could delay both countries' cyclical economic recoveries and affect capital flows, says Moody's, although both countries have adequate resources to meet their needs in periods of adverse market conditions.

India, on the other hand, is less exposed to global risks because of its more resilient economic growth and the impact of positive policy reform momentum, according to the rating agency. (SH)

Fibre2Fashion News Desk – India

Must ReadView All

Union textiles minister Smriti Irani addressing at the Texprocil Annual Export Awards. Courtesy: PIB

Textiles | On 22nd Oct 2016

Govt to extend special package to home textiles segment

The Central government is likely to extend the recently approved Rs...

Reebok Liquid Speed Grey. Courtesy: Business Wire

Apparel/Garments | On 22nd Oct 2016

Reebok’s Liquid Factory brings sneaker creation to US

Reebok, a pioneer in the sporting goods industry, has brought sneaker ...

Courtesy: GHCL

Textiles | On 22nd Oct 2016

GHCL to invest Rs 67.25 crore in textile division

Chemicals and textiles firm GHCL will invest Rs 67.25 crore in its...

Interviews View All

Karan Suratwala
Key Textile Accessories Private Limited

Chinese imports are destroying the supply chain

Victor Chao

‘In future, clothing boundary lines will become increasingly blurred.’

Kamlesh Vaghela
RK Textiles

Very few machinery manufacturers have R&D units

Lynda Kelly
Suominen Corporation

Suominen Corporation is a manufacturer of nonwovens as roll goods for...

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Ashok Desai
Bombay Textile Research Association

Bombay Textile Research Association (BTRA) is a leading name in textile...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Mike Hoffman
Gildan Activewear SRL

Gildan Activewear, a manufacturer and marketer of branded clothing and...

Sonam & Paras Modi

Sonam and Paras Modi's Sva Couture is synonymous with head-turning...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies

October 2016

October 2016

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Browse Our Archives


Advanced Search