The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

CDS: Panic hits emerging markets

With CDS prices at unprecedented levels, the crisis shows no sign of abating.

The financial whipsaw that has cut through the emerging markets in recent weeks has evoked bad memories of the 1990s when collapsing currencies, bank runs and IMF missions became commonplace.

Those crises – in Mexico in 1994/95 and in Asia and Russia later in the decade – were self-made. Today, the emerging markets have become caught up in the crossfire that began in the West and has now spread to all corners of the world.

Trying to make sense of what is happening is no easy task. Emerging markets are, for the most part, far better managed and have many more resources available than in previous crises but that seems to matter not a jot as even relatively strong countries are coming under attack. Indiscriminate selling is the order of the day as investors make a mad dash for the safe havens of the US dollar and treasuries. The sense of panic, moreover, shows no signs of going away.

Russia’s five-year CDS, for example, is trading at distressed levels of 1,123bp. Although Russia is still in reasonable shape compared to its peers, investors foresee greater risks ahead.

The sliding oil price potentially puts its current account and fiscal surpluses in danger of turning into deficits.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree