A sense of optimism has pervaded financial markets in recent months, amid investor confidence that the fight against inflation is entering its “last mile” and that central banks will ease monetary policy in the coming months. Stock markets around the world have risen substantially this year. Corporate and sovereign borrowing spreads have narrowed. And major emerging markets’ currencies and capital flows have remained resilient, while several frontier markets have regained access to international funding markets. And yet, there are likely to be bumps along this last mile, as we show in the latest Global Financial ... (full story)