The BSP said the hot money
outflows "may be attributed to profit taking as well as investor reaction to news of possible rate increases by the US Federal Reserve due to an expected surge in inflation amidst implementation of the US government's tax cuts.
Unlike FDIs which are more difficult to repatriate, hot money
comes and go like a hurricane, leaving in its wake a battered currency and worse economy.
11 million in net portfolio investments had already been withdrawn from the domestic financial system, this being the difference between gross hot money
inflows of $2.
Foreign portfolio investments or hot money
recorded an overall net outflow of $205.
Economic Daily News: Hot money
influx expected to start stock market boom
Money experts expect that a large share of hot money
will exit the EGX by the end of 2016, to be replaced by either foreign funds for medium- and long-term investments, or the entry of local investors.
Oman's capital market would have to live with hot money
that flows into its markets, as there is no mechanism to distinguish the type of money, he added.
As interest rates climb, we will see hot money
coming into the country, strengthening the pound.
Interestingly, since relatively high interest rates are relatively more available in developing countries, hot money
has become the key financier of authoritarian regimes.
Simply put, exchange rate movements cannot correct net trade (saving) imbalances between open economies, but they can increase hot money
At the same time, the BSP will continue to cast a watchful eye towards hot money
flows, and may yet decide to implement further macroprudential measures in order to minimise risks stemming from US monetary policy-related external volatility.
For Turkey I guess this should be taken as a warning for Basci et al, that they have to reduce the current account deficit, narrow the external financing requirement and reduce dependency on hot money
inflows - if they don't then when tapering actually comes they will be brutally exposed.