Emerging Countries' Counter-Currency Cycles in the Face of Crises and Dominant Currencies

This article explores how emerging economies use countercyclical monetary policies, such as interest rate adjustments, foreign exchange interventions, and capital controls, to manage crises and fluctuations in dominant currencies like the US dollar and the euro. Highlighting economic cycles and financial crises - including 1997, 2008, and the COVID-19 pandemic—the article emphasizes the vulnerabilities of emerging markets to external shocks.Through case studies of Brazil, India, and Nigeria, it demonstrates how these nations navigate economic instability with monetary tools, despite structural and institutional constraints. An econometric analysis using a VAR model evaluates the effectiveness of these policies on GDP, inflation, and exchange rates, showing how emerging economies can adapt to external shocks and stabilise growth in the long term.© The Author(s) 2024. Published by RITHA Publishing under the CC-BY 4.0. license, allowing unrestricted distribution in any medium, provided the original work, author attribution, title, journal citation, and DOI are properly cited.