| The massive build-up of foreign exchange reserves in emerging markets is clearly leading to domestic problems. This rapid accumulation of largely U.S. dollar assets – part of an effort to control the pace of currency appreciation and protect export sectors – is coming even at the expense of growth in domestic demand, according to Joseph Lupton, senior global economist at J.P. Morgan.
“By any metric, the continued surge in emerging market foreign exchange reserves is well above what could be called precautionary,” he said in a recent report..............................................Full Article: Source
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