The International Capital Markets report is an integral element of the IMFÂ’s surveillance of developments in international financial markets. The IMF has published this report annually since 1980. The report draws, in part, on a series of informal discussions with commercial and investment banks, securities firms, stock and futures exchanges, regulatory and monetary authorities, and the staffs of the Bank for International Settlements, the Commission of the European Union, the International Swaps and Derivatives Association, the Japan Center for International Finance, and the Organization for Economic Cooperation and Development. The report reflects information available from January 1997 up to the end of May 1997; a special chapter provides an update of exchange market developments in the emerging markets through July 1997. It gives informations about developments and trends in the mature markets, systemic implications and challenges in EMU, developments and prospects in emerging markets, external liability management, developments in international banking, and emerging market currency crises of July 1997.