Foreign investment in emerging markets has dropped to the lowest level since the financial crisis as investors are braced for the fallout of the first US interest rate rise in nearly a decade.

Years of growth fuelled by access to cheap funding by virtue of low interest rates in the developed world and China’s robust appetite for commodities are seen ending, leading economists at the Bank of International Settlements to warn of negative spillovers as borrowing costs rise.

Prices in popular emerging market debt and equity benchmarks have already fallen, while net inflows from overseas investors have dropped from $285bn in 2014 to $66bn this year, according to the Institute for International Finance, a group representing the world’s largest financial companies.