(Bloomberg) -- Emerging-market stocks had their best week since late 2018 and currencies rallied as stimulus measures from central banks and governments gave risk assets a reprieve following their battering from the coronavirus outbreak. India and Colombia were the latest nations to join a wave of global rate cuts, while South Africa and Indonesia announced measures to boost liquidity.
The following is a roundup of emerging-markets news and highlights for the week ending March 29.
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The U.S. Federal Reserve unveiled sweeping measures as it raced to contain the economic and market fallout from the coronavirus. The central bank said it would buy unlimited amounts of Treasuries and mortgage-backed securities to keep borrowing costs at rock-bottom levels and help ensure markets function properlyFed earlier last week offered to directly finance U.S. companies, jumping ahead of Congress, which is still arguing over similar assistanceChairman Jerome Powell said the central bank will maintain its muscular efforts to support the flow of credit in the economy as Americans hunker down from the coronavirusPresident Donald Trump signed the largest stimulus package in U.S. history on Friday, a $2 trillion bill intended to rescue the coronavirus-battered economySouth Korea doubled its emergency funds to around 100 trillion won ($83 billion) in an attempt to protect businesses and financial markets from the pandemic that’s wreaking havoc on the global economy. India announced a 1.7 trillion rupee ($23 billion) spending plan. Singapore unveiled a second stimulus package of S$48 billion ($34 billion)Reserve Bank of India cut rates and announced steps to boost liquidity in an unscheduled move, joining central banks around the world in scaling up stimulusThe International Monetary Fund said that it’s working to get aid to developing nations whose own resources will fall short of the $2.5 trillion that they need to address the coronavirus pandemicPresident Trump said the U.S. economy can’t remain stalled for too long to fight the coronavirus, declaring the country “was not built to be shut down”Trump said he’ll stop using the term “Chinese virus,” a sign U.S. and China want to deescalate their blame game over the pandemic, though his top diplomat kept up accusations that Beijing is waging a misinformation campaign about its originChina’s Hubei province will allow transportation to resume for the city of Wuhan on April 8, effectively lifting a quarantine over the city where the coronavirus first emerged last DecemberSouth Africa lost its last investment-grade rating on Friday when it was downgraded to junk by Moody’s Investors Service, meaning it will be excluded from the FTSE World Government Bond IndexesFinance Minister Tito Mboweni told local newspaper Sunday Times that he may approach the World Bank and IMF for funding to deal with the coronavirus falloutThe country’s local-currency bonds and the rand had rallied on Wednesday after the central bank said it will start buying debt in the secondary market in an unprecedented intervention to boost liquidity
Lebanon kicked off talks to restructure its $90 billion debt pile on Friday with a promise to present a comprehensive recovery plan for its “broken” economy before the end of this year
Investors in credit insurance on Lebanon are set to receive a payout after a binding ruling from a CDS committeeRussian President Vladimir Putin laid out plans to boost taxes on dividends paid to offshore entities to 15% from 2%, and ordered a 13% levy on interest from bank deposits of more than 1 million rubles ($12,900) as well as local government-bond holdingsS&P Global Ratings cut Mexico’s sovereign credit score one notch to BBB, saying shocks from the coronavirus and an oil price rout will harm the country’s economic outlookThe ratings company also downgraded oil producers Kuwait, Oman, Nigeria and AngolaInvestors withdrew $2.94 billion from U.S.-listed emerging-market ETFs in the week ended March 20Russian oil giant Rosneft sold its assets in Venezuela to the Russian government, in what may be a maneuver to avoid any U.S. sanctions in an escalating fight between Caracas, Washington and MoscowNorth Korea fired what appeared to be two short-range ballistic missiles into its eastern sea, marking the fourth launch of projectiles this month
China’s government talked up the prospects for a rapid economic rebound from the coronavirus, even as the global economy sees further lockdowns to curb the pandemic
As traders around the world struggle to get their hands on the dollar, liquidity in China was so plentiful that borrowing in yuan costs the least in 14 yearsAn unusual public spat between two top Chinese diplomats pointed to an internal split in Beijing over how to handle rising tensions with a combative U.S. presidentRead: Second Virus Shockwave Is Hitting China’s Factories AlreadyIndustrial profits dropped by 38.3% in the first two months of this year compared to the same period in 2019. Profits at state-owned firms, private companies and foreign-invested business all dropped more than 30%.Bank of Korea pledged “unlimited” liquidity to financial institutions strained by the coronavirus in a move resembling quantitative easing; the authority said on Sunday it will provide $12 billion to banks in its first round of dollar injections using a currency swap line with the Federal ReserveSouth Korea will loosen its rule on FX liquidity coverage ratio for banks to 70% from 80% until end-May, Vice Finance Minister Kim Yongbeom saidSouth Korea had become the latest country where yields on short-term corporate debt have surged due to the coronavirusBank of Korea will provide liquidity to securities companies via repo agreements with five non-banking financial institutions, according to a BOK officialIndia suspended all domestic flights from midnight Tuesday, the final piece of a nationwide lockdown that threatens Prime Minister Modi’s attempts to revive the economyIndia’s foreign-exchange reserves posted its biggest weekly drop since 2008, falling by $12 billion as the central bank aggressively stepped in to defend the rupeeIndian banks will be allowed to trade in the offshore currency market in a step toward liberalizing foreign-exchange tradingIndian lenders bid for fewer dollars than the amount that the central bank offered via a swap line even as a global scramble for the greenback intensified. The central bank accepted bids worth $650 million for its second foreign-currency swap auctionIndonesia’s central bank began holding daily repurchase and foreign-exchange swap auctions to bolster liquidity as an investor exodus from bonds and stocks pushed the currency to near a record lowBank Indonesia was seeking a dollar liquidity swap line facility from the Federal Reserve, Governor Perry Warjiyo saidIndonesia should temporarily ease a legal cap on its budget deficit to allow the government to ramp up spending to counter the economic fallout of the coronavirus outbreak, according to an influential panel of lawmakersPresident Joko Widodo ordered spending cuts across the public service so that expenditure can be reallocated to fight the coronavirusIndonesia is considering issuing rupiah-denominated recovery bonds for the first time to finance incentives for private companies to counter the fallout of the coronavirus
Malaysia announced billions of dollars in fresh support for an economy punished by the coronavirus pandemic
Malaysia extended its lockdown period by two weeks as the number of infections keeps climbingBank Negara Malaysia is rolling out additional measures to help those facing financial constraints from the pandemic, according to a statement from the central bank to Malaysian lendersMalaysia has banned short-selling until April 30 to mitigate risks arising from heightened volatility and global uncertaintiesThailand became one the latest countries to go into a lockdown when a state of emergency was enforced from Thursday to fight the spread of the coronavirusThailand said it’s mulling an emergency decree to enable the government to borrow more to support the economy over the next two to three monthsBank of Thailand left its benchmark rate unchanged after an emergency cut the week before, while projecting the worst contraction in the economy since the Asian financial crisisThailand’s foreign tourism receipts plunged in February to the lowest since 2015Philippines is moving to tackle the widening fallout from the coronavirus, with the central bank approving the purchase of government securities to help boost state funding and legislators granting President Rodrigo Duterte extra powersPhilippine central bank is infusing more funds into the economy, slashing big lenders’ reserve requirement ratio by 2 percentage points and flagging more cuts to comeBangko Sentral ng Pilipinas will remit 20 billion pesos ($392 million) as advance dividend to the government to help support programs against the coronavirusPhilippines is prepared to tap all possible markets and widen its budget deficit to combat the coronavirus, Finance Secretary Carlos Dominguez said
Egypt’s main stock index was among the world’s best performers on March 23 after news the central bank would support the bourse to the tune of 20 billion Egyptian pounds ($1.27 billion)United Arab Emirates rolled out a slew of measures to contain the coronavirus -- from suspending flights, shutting malls to adding more firepower to its stimulus packageDollar pegs in the Gulf have proven effective even as the region now faces the coronavirus outbreak and the crash in oil prices, the International Monetary Fund saidSaudi Arabia locked down its capital Riyadh and holy cities of Mecca and Medina to prevent the spread of the coronavirus
The devastation of the coronavirus outbreak in Iran is raising pressure on the U.S. to ease sanctions on the country. So far, the Trump administration isn’t budging
Iranian President Hassan Rouhani wants to tap the country’s sovereign wealth fund for $1 billion to support a healthcare system overstretched by the coronavirus outbreak, state-run Islamic Republic News Agency reportedIMF’s Executive Board approved a four-year $1.3 billion program for Jordan, Minister of Finance Mohammad Al Ississ saidIsrael’s central bank is adding to its lead role in trying to keep the economy and markets from unraveling in the face of the coronavirusInvestors trapped in some of the world’s most illiquid bond markets are rushing to short local currencies, driving up the price of hedging their positionsHungary’s central bank offered domestic lenders a backstop of $29 billion to fight the economic fallout from the coronavirus, triggering a rally in government bonds while sending the forint to near a record lowThe Czech government sold the largest amount of domestic bonds ever, helped by preparations for potential quantitative easing by the central bank and a rebound in global risk appetiteTurkish President Recep Tayyip Erdogan announced new measures to fight the spread of the coronavirus, imposing further restrictions on people’s movement and banning large gatheringsTurkish manufacturers’ confidence in the economy has plunged the most since the 2008 global financial crisis, the first key piece of data reflecting the coronavirus’s toll on local businessesSouth African President Cyril Ramaphosa reappointed Kuben Naidoo as deputy governor of the central bank, ensuring continuity at the institution’s top level for least another four yearsSouth Africa’s banking regulator plans to give banks a break from accounting and capital rules that could release around 300 billion rand ($17 billion) for lending to help the economy cope with the fallout of the coronavirusSouth African authorities ordered a three-week lockdown to curb the spread of the coronavirus as infections continue to surgeNigeria’s central bank held its benchmark interest rate at 13.5%, going against the global trend of slashing borrowing costs as it tries to prop up the nairaKenya is in talks with the World Bank for budget support of $750 million and the IMF for $350 million in emergency assistanceAngola will wait for debt markets and oil prices to recover before attempting a Eurobond sale as large as $3 billion that’s been approved by the president; the central bank held its main interest rate at 15.5% on FridayAfrica’s currencies, among the worst hit this month, may be in for even more pain
Ecuador said it would hold talks with creditors to re-profile its liabilities and announced it would exercise a 30-day grace period on bond interest paymentsBrazil’s President Jair Bolsonaro urged the population to resume normal life to protect the economy, even as cases of coronavirus rose, triggering a clash with state governments that imposed social distancing measures as Sao PauloBrazil posted the slowest mid-month inflation in more than a year in March and retail sales fell more in January than economists predictedCentral bank refrained from cutting rates more aggressively due to concerns about the interruption of a reform agenda, minutes of the latest meeting showed; officials expect the economy to stagnate this yearMexican President Andres Manuel Lopez Obrador’s relationship with the business elite is rapidly deteriorating over the response to the coronavirus and his decision to back a local referendum to shutter a partly built $1.5 billion beer plantInflation slowed in early March amid declining gasoline pricesArgentina’s economy shrank 2.2% last year, even before the coronavirus took its global tollNation closed its borders until March 31International Swaps & Derivatives Association received a request from an eligible market participant to consider whether a potential debt repudiation or moratorium occurred in ArgentinaColombia’s central bank cut borrowing costs for the first time in two years at a regularly scheduled meetingColombia’s central bank is buying debt issued by local lenders as it extends emergency measures to prevent liquidity from drying up following the crash in the bond marketPeru’s congress voted in favor of giving the government legislative powers for measures to mitigate the economic impact of the coronavirus pandemicPanama sold $2.5 billion in global bonds as it steps up spending to contain the worst outbreak of coronavirus in Central America
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