Macro Risk

Macro risk refers to the risk associated with broad economic, political, or social factors that can negatively impact financial markets and investments. These risks include inflation, interest rates, exchange rates, political instability, and global economic conditions. Macro risks are difficult to predict and can affect entire economies or markets, making them a key concern for global investors and businesses.

Example

An investment in an emerging market may face macro risks such as political instability, currency devaluation, or economic downturns, which could significantly affect the investment’s performance.