Financial markets across Emerging Europe have sold off sharply over the last month as concerns about the health of the global economy continue to build, denting investor risk appetite. Equities have been hit particularly hard. The Turkish ISE Index is down by 20% since the start of the year and the Romanian BET Index is down by 25%. The currencies of those countries with large current account deficits have also suffered. But pockets of strength do exist: expectations of higher interest rates have driven a 4% rise in the Czech koruna since the start of the year.
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