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Economic Research: Emerging Markets: Where Is The Slack At The Sector Level?

Emerging Markets (EM) are facing a challenging period as they navigate through tighter monetary policy in the U.S., the repercussions of the Russia-Ukraine conflict, and the impact of COVID-19-related lockdowns in China. Those dynamics threaten to set back the economic recovery from the pandemic downturn, which in most EMs is far from complete as those new challenges emerge. But how incomplete is the recovery from the pandemic, and which parts of EM economies face a higher threat of setbacks from these set of new challenges? One way of answering those questions is by taking a look at output at the sector level, rather than the aggregate GDP level.

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