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* International Monetary       Fund (IMF)

The dollar was hovering just below a 20-year high on support from safe-haven flows on Wednesday, as regional currencies struggled. 

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Emerging market shares fell as investors braced for a possibly savage U.S. rate hike later in the day.

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The U.S. Federal Reserve is expected to raise interest rates by 75 basis points (bps), with a 13 percent probability of a very large 100 bps increase.

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Michel Nies note that "EM, faces weak external demand alongside tighter U.S. monetary conditions - this generates a strong dollar environment, which weighs on global trade,

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while FX pass-through limits the room for accommodative policies."
In July, investor confidence was undermined by rising inflation, political unpredictability,

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and mounting worries of a global recession, which led to a 1.5 percent decline in stocks this month and a 1% decline in currencies.

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On Tuesday, the International Monetary Fund again lowered its projections for world growth, citing dangers from high inflation and

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the conflict in Ukraine as factors that might push the global economy into a recession.

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The Fed may try to restore its credibility, and China's structural shift towards a less EM-friendly business model is likely to continue,

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so getting there may take longer than usual. Nevertheless, EM will eventually face a more favorable combination of external demand and U.S. monetary conditions again.

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In line with general market caution, EM stocks declined by 0.3 percent, with China shares falling as much as 0.5 percent.

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The yuan and the Indian rupee had no movement, while the rand and the peso of Mexico added 0.4% and 0.2%, respectively, and the lira of Turkey fell by 0.2%.

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The dollar maintained at 107.08, just shy of its 20-year high reached in mid-July of 109. The exchange rate for the pound in Egypt was 18.87 to 1.

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According to the IMF, the nation needed to make "decisive progress" on structural and budgetary reform.