Takeaways from the IMF-World Bank Fall 2025 meetings

The exceptional resilience of emerging markets and diversification from the US dollar were two of the main topics of discussion at the recent series of meetings organized by the International Monetary Fund (IMF) and the World Bank.

The event, which took place in Washington DC in mid-October 2025, saw central bankers, finance ministers, academics and representatives of asset-management companies and hedge funds come together to discuss the global economic outlook, international development and the strength of the world’s financial system.

Good economic policy framework and implementation with a backdrop of reasonably benign external conditions – luck – have underpinned the resilience of emerging markets which have weathered shifts in global risk appetite much better than in previous risk-off shocks.¹ That was one of the major messages we took away from attending the annual World Bank and IMF meetings in Washington.

Improved policy frameworks, fiscal orthodoxy, independence of central banks and open dialogue with market participants are some of the factors that have contributed to improved confidence and trust within the investment community.

Development and growth of local currency bond markets has diversified the investor base contributing to greater resilience. Increased domestic ownership of local currency debt reduces the sensitivity of EM debt to global macroeconomic shocks.

Speaking with investors who were in Washington for the meetings, we found many are more bullish on the asset class now than at any time over the previous decade. Overall, the IMF is cautiously optimistic on emerging markets in general, given that the international economy has held up despite trade tensions.

There is a strong market consensus that the US dollar is likely to continue the downward trend driven by Liberation Day, questions around independence of the Federal Reserve and ongoing anticipation for further US rate cuts.

While diversification away from the dollar seems to be happening at the margin, broad de-dollarization is not occurring, and emerging market currencies remain supported.

Brazil, Chile, Bolivia and Colombia face critical elections and the Latam region received more attention from investors as US policy towards the region turns more assertive, bilateral, strategic, and national security based.

The Middle East region outperformed the IMF’s previous forecast, which was expecting negative consequences from uncertainty shocks. Real GDP growth was strong in first half of 2025, driven by oil production, resilient remittances, and stronger tourism. Longer-lasting stability in the region is likely to improve its foreign investment outlook, economic activities and additional gains in external revenues.

Footnotes:

¹ Emerging Market resilience: Good luck or good policies?