IMF: Crisis Hasn't Hurt Emerging Markets Yet

The credit crisis is continuing to broaden and spread to other mortgage and corporate debt markets, but emerging markets so far have been largely unaffected by the concern, according to the International Monetary Fund. "Credit deterioration, which was first evident in the U.S. subprime market, is now showing up in higher-quality residential mortgages, U.S. commercial real estate, and the corporate debt markets," the IMF said in a new report. Financial markets continue to be stressed by weakened financial institution balance sheets, a continuing deleveraging process, declining asset prices, and a "macroeconomic environment that is more challenging because of the weakening global growth," said Jaime Caruana, head of the IMF's Monetary and Capital Markets Department.