Foreign currency borrowing at new high in Asia
The risk comes from the potential rise in the US dollar against Asian currencies. If it does, emerging nation borrowers will be squeezed
London
FOREIGN currency borrowing of Asian governments and corporations has soared to new heights, helping finance companies and boosting growth.
But the danger lies in the potential appreciation of the US dollar and other exchange rates against Asian and other emerging nation currencies. If, for example, the US dollar rises, the interest and loan repayment cost in local currency terms increases and places financial pressure on the borrower. Emerging-nation borrowers were squeezed during the Asian crisis of 1997 to 1998 and also in 2013 and 2014.
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
International
Sri Lanka’s economy expected to grow 3% in 2024, central bank says
Yellen says US can bring inflation down without hurting jobs
US dollar briefly falls versus yen after GDP data
US weekly jobless claims unexpectedly fall
US economic growth slows more than expected in Q1
Malaysia ex-PM Mahathir facing anti-graft probe in a case involving his sons