Where there is more controversy is over the interpretation of these patterns, with some arguing that they reflect waves of irrational investor sentiment and others taking the view that they come from more rational factors, such as time variation in either the risks facing investors or their tolerance for bearing such risks.
Overall, the risks are seen to be on the downside due to global developments and their possible impact on commodity prices. Natural resources and commodity exports remain the main growth driver for sub-Saharan Africa, and the region is therefore vulnerable to the global downturn through this channel. The recent increase in global food prices should, however, benefit African food exporters.