EM Preview for the Week Ahead

blog-icons-empreview emerging markets previewEM FX ended last week on a firm note, though most were still down for the week as a whole.  Commodity prices stabilized, but the balance remains fragile, in our view.  We remain cautious, especially with regards to the high beta currencies such as BRL, MXN, TRY, and ZAR.  Continue reading

What Has Changed in EM

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  • MSCI announced it will include 222 China Large Cap A-shares in its Emerging Markets Index
  • Czech central bank is pushing out rate hike expectations
  • Hungary central bank eased again using unconventional measures
  • MSCI announced that it has launched a consultation on reclassification of Saudi Arabia from Standalone to Emerging Market status
  • South African court ruled that the Zuma no confidence vote can be secret
  • South African government official wants to change the mandate of the central bank
  • Brazil Senate committee rejected the labor reform bill by a 10-9 vote
  • Banco de Mexico signaled an end to the tightening cycle  Continue reading

Some Thoughts on Recent Argentina Developments

new argentinaArgentina has been in the news this week.  Whilst MSCI delayed its decision on reclassifying Argentina, the nation was still able to place $2.75 bln of 100-yaer bonds even as the economy emerged from recession.  We remain positive on the medium-term outlook, and believe that foreign investors should continue to build up Argentine exposure.  Continue reading

EM Preview for the Week Ahead

blog-icons-empreview emerging markets previewEM FX was mixed Friday to cap off a mostly lower week.  Obviously, we’re seeing a bit of a washout in EM after the hawkish FOMC.  Market was overly complacent and very long EM going into the FOMC meeting.  The big question is how deep this selloff gets.  For the better part of this year, EM dips have been met with renewed buying.  We remain cautious on EM and think that investors should avoid the high beta currencies like ZAR, TRY, BRL, MXN. Continue reading

What Has Changed in EM

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  • Philippines central bank forecast a current account deficit this year, the first one in fifteen years
  • Kuwait refrained from matching the Fed’s 25 bp hike
  • The US Senate voted overwhelmingly to step up sanctions against Iran and Russia
  • Moody’s downgraded South Africa by a notch to Baa3 with negative outlook
  • South Africa plans to require that all local mines be 30% black-owned
  • Brazil press reported that President Temer ordered the country’s intelligence service to spy on Supreme Court Judge Edson Fachin
  • Petrobras announced cuts in fuel prices Continue reading