EM benefited greatly from the improvement in US-China trade relations and quite possibly Brexit. The dollar is likely to remain under some pressure near-term as a result. Yet we must caution investors against getting too optimistic. The details of the partial trade deal still need to be worked out, while existing tariffs will still remain in place if the deal is signed next month as most expect.…
14 Oct 2019
Bonds & Loans examines the strengths, weaknesses, opportunities and threats across Africa following a research trip to the region.
10 Oct 2019
Most dedicated fixed-income investors have by now realized that emerging markets cannot be treated homogenously, and that blanket statements or generalizations about “emerging market debt” tend to be misleading, or even plain wrong. But with a total of 110 sovereign credits forming the investible EM universe, indexes represent less than half of all investible assets – which is why Eaton Vance, a…
8 Oct 2019
EM got some traction last week as the dollar came under renewed pressure. However, the global backdrop remains negative for EM. US-China trade talks this week are unlikely to yield any progress, which means the next round of tariffs will go into effect mid-October. While odds of a Fed rate cut this month have risen, we do not think the positive liquidity story will outweigh the negative global…
7 Oct 2019
One of the consequences of low growth is that the economic recovery is not widespread across sectors. Some continue to perform well in the midst of stagnation – and even contraction, in the case of many others.
1 Oct 2019
US-China trade tensions are likely to remain high. China reported slightly firmer than expected September PMI readings over the weekend. With more tariffs going into effect in September and again in December, however, the economy is still facing stiff headwinds. This will continue to have negative knock-on effects on the rest of EM.
30 Sep 2019
So far, 2019 has seen a marked escalation of political tensions within Kenya’s ruling Jubilee coalition. The coalition – led by President Uhuru Kenyatta and Deputy President William Ruto – has so far been able to effectively keep a lid on the political and ethnic divisions that boiled over into widescale violence ten years ago. The recent arrest of a high-profile minister has sparked concerns…
27 Sep 2019
Privatization and asset sales are on the agenda for the Bolsonaro administration as it seeks to restore the fiscus; but time is running short for the government to start delivering, warns Zeina Latif.
24 Sep 2019
We think the Fed has signaled that the bar to another cut is high. Unless the US data weakens considerably, we see rates on hold for now and this means the liquidity story for EM has worsened. Elsewhere, US-China trade talks appear to be going nowhere. With no end in sight to the trade war, we remain negative on EM.
23 Sep 2019