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The emerging market currencies have been slammed over the past week or so. Names like Brazilian real, Mexican peso and South African rand have declined by 5.65% to 4.48%, respectively. 

“We are in a real EM sell-off now,” Robin Brooks, chief economist at the Institute of International Finance (IIF) and former chief strategist at the investment banking giant Goldman Sachs tweeted on Wednesday. 

According to Brooks, traders have put a bid under the US dollar on disappointment that Federal Reserve’s recent decision to adopt average inflation targeting did not translate into more stimulus and due to renewed coronavirus concerns and fading hopes for US fiscal stimulus.