Iran War Risk Looms: Emerging Market Currencies May See Biggest Drop Since 2023

MSCI Emerging Markets Currency Total Return Index once fell by 0.9%, while both the US dollar and gold rose as investors flocked to safe-haven assets. Central banks in Indonesia, Turkey, and India had to intervene in the foreign exchange market to maintain their local currency exchange rates. Due to the surge in oil and natural gas prices, traders reduced their bets on interest rate cuts in Eastern European countries. Expand