Portfolio investment flows to emerging markets worst since '13

Tokyo

THE full extent of last week's dramatic rout in emerging markets - going well beyond China, where international attention has been mainly focused in recent days - is revealed in the latest capital flows data published by the Washington-based Institute of International Finance (IIF).

This suggests that, so far as equity investors are concerned, these markets are now being seen as "submerging" rather than "emerging" markets, analysts suggest. It raises questions about the wisdom of allowing volatile short-term capital flows to influence asset prices and currency values, they say.