The World Bank has warned developing countries to brace themselves for possible financial turbulence when the US Federal Reserve starts to raise interest rates.

It could come as early as Thursday when the Fed concludes a policy meeting.

A new report from the World Bank says there will probably be a modest impact on developing countries.

But it also warns there is some risk that it could be worse.

The Bank says it is possible that there would be sufficient disruption to capital flows into developing countries to harm economic growth and financial stability.
‘Perfect storm’

US interest rates have been practically zero for more than six years and as the economy continues to recover, the Fed is sure to raise interest rates at some stage. The prospect has been a major concern for financial markets all year.

Developing countries are bound to be affected when it happens and the first step might be imminent. Details