Central Bank of Uruguay President Guillermo Tolosa argued that stronger policy frameworks have reduced economic volatility in emerging markets, particularly Latin America, while allowing continued global integration with safeguards against external risks. Speaking at a breakfast with central bank presidents and economy ministers and on a panel with professor Nouriel Roubini and other institutional officials, he cautioned that savers and investors may recognize this shift only gradually, delaying its financing and growth benefits. Tolosa described a “Great Moderation of emerging markets,” linking the reduction in volatility to frameworks developed following the risks experienced during the early phase of globalization about 25 years ago. Rather than retreating from integration, these frameworks seek to preserve its benefits while limiting exposure to risks arising from interdependence. Lower volatility offers a more predictable environment that supports lower financing costs and better growth conditions, but slow adjustment in investor perceptions can constrain those gains.
Central Bank of Uruguay president highlights stronger Latin American policy frameworks and delayed financing benefits
Central Bank of Uruguay President Guillermo Tolosa highlighted stronger policy frameworks and reduced economic volatility in emerging markets, particularly Latin America, during discussions with international officials and a panel including professor Nouriel Roubini. He argued that these frameworks support continued global integration with safeguards, but warned that gradual recognition by savers and investors could delay lower financing costs and growth benefits.