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Dow Jones collapse may signify capital outflow from developing countries

February 07, 2018, 17:09 UTC+3 SOCHI

This will entail some additional outflow from emerging markets, including Russia, ex-finance minister assumes

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© AP Photo/Mark Schiefelbein

SOCHI, February 7. /TASS/. The recent collapse of the Dow Jones may be due to rising inflation and a possible growth of rates in the United States, which, in turn, might trigger capital outflows from emerging markets. However, such scenario will not seriously affect Russia, Head of Russia’s Center for Strategic Research (CSR), ex-Finance Minister Alexey Kudrin told reporters.

"This will entail some additional outflow from emerging markets, including Russia.... Russia has already been under sanctions and does not have the same outflow potential. <…> There will be no significant impact on our market if the Federal Reserve’s rates start to rise," Kudrin said.

On Tuesday, following the US Dow Jones index, which hit a record low of 4.6% on February 5 and S&P 500 index, which lost 4.1%, the Japanese Nikkei fell by 7%, the Chinese stocks fell by 2%. Russian exchange indices ended the trading day on Tuesday with a downward trend. The dollar-denominated MOEX Russia Index (previously MICEX) declined by 1.7% to 2,238.24 at the close of the trading session. The ruble-denominated RTS index dropped by 2.46% to 1,232.69 points.

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