OECD monetary policy threatens EMs - First State

First State's Asia Pacific and global emerging markets team has raised concerns that loose monetary policy in OECD countries is threatening developing nations.

Fund manager Glen Finegan says money pouring into emerging markets could cause inflation to reach dangerously high levels. "Policy makers have cut rates to zero, effectively forcing investors to look elsewhere for growth," he says. "Europe is stagnant, America is offering selective opportunities, so the place to be for growth is emerging markets. "It makes us nervous when we see investors piling in as that can lead to inflation." Although First State's Asia Pacific and global emerging market funds have long held gold positions as a hedge against inflation, they are increasingly ...