Even so, the trouble in emerging markets is a surprising and unsettling reversal.
“It’s remarkable just how things turned around so quickly,” says Neil Shearing, an economist at Capital Economics and a former British Treasury official.
Consider Peru. Three years ago, its capital, Lima, was chosen to host an International Monetary Fund’s meeting of global finance officials in what was seen as a celebration of Latin America’s arrival in the economic big leagues.
But with the event six weeks away, Latin America’s outlook has descended from boom to gloom. Peru’s economy has steadily slowed, and its currency, the nuevo sol, has plunged 2.5 percent against the U.S. dollar in the past month.
And Peru boasts one of the region’s healthiest economies. Brazil’s economy is expected to shrink this year and next. Its currency, the real, is down 7 percent the past month and more than 30 percent the past two years. The Mexican peso closed Friday at a record low against the dollar.
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