Emerging market resilience to risk-off shocks: Good luck, but mostly good policies by Marijn Bolhuis, Francesco Grigoli, Marcin Kolasa, Roland Meeks, Andrea Presbitero, Zhao Zhang published by VOXEU (12/2025).
Emerging markets used to be hit hard whenever global investors turned nervous. This column analyses how emerging markets have managed output and inflation during global risk-off episodes over the past three decades. It shows that stronger policy frameworks – from credible inflation targeting to tighter macroprudential rules – now help countries keep growth steadier and inflation contained during risk-off shocks. These reforms matter at least as much as supportive global conditions. This new resilience suggests emerging markets are moving closer to real monetary policy independence.