Net capital inflows into emerging market economies are running at record levels, pushing up asset prices and raising the risk governments may impose capital controls, Goldman Sachs Group Inc. said in a research report today.
The euro fell versus the dollar as the European Central Bank signaled it’s monitoring gains in the currency for deflation risks. The yen rose on demand for a haven amid turmoil in Ukraine and pessimism about China’s economy.
The Australian dollar headed for a weekly drop versus currencies of the U.S. and Japan on concern China’s economy is slowing and before Crimea votes this weekend on whether to leave Ukraine to join Russia.
HSBC Holdings Plc, which gets more than half of its revenue from emerging markets, says it’s time to start buying their currencies after a selloff pushed exchange rates to their lowest levels since 2009.