Global Market: Emerging markets lean on global funds, but face rising risk of sudden capital flight
Published on: April 8, 2026, 9:41 a.m. | Source: The Economic Times
Emerging economies now depend heavily on global investors like hedge funds for funding. This shift, driven by a retreat of traditional banks, has doubled portfolio investment share to 80%. While this provided cheaper, longer-term funding, it also increased vulnerability to sudden capital outflows. Economies with shallow markets face greater risks from these volatile flows.
