Page 13 - ISQ UK_October 2021
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OCTOBER 2021
Growth Differential and Relative Performance Are Highly Correlated
Emerging markets tend to grow faster than advanced economies, with the relative performance of equity markets closely tied to the
directional trends. While emerging markets have lagged, we expect rising vaccination rates and a strong global recovery to turn the
growth differential back in their favour.
5 4 0.50
Relative Growth Differential (%) 3 2 0.30 Relative Performance (Ratio)
0.40
0.20
0 1 0.10
0.00
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 Est. Est.
'21 '22
EM - DM Growth Differential Relative Peformance of MSCI EM vs MSCI World
Share of Global Growth
The International Monetary Fund expects emerging markets to capture an increasingly larger share of global growth on a purchasing-
power parity basis in the coming years, making their economic importance hard to ignore.
* Dotted lines represent forecasted numbers
65%
*
55%
45%
*
35%
2000 2005 2010 2015 2020 2025
Advanced Economies Emerging Market and Developing Economies
Source: IMF, as of 9/15/2021
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