Emerging Markets Credit View: More of a Carry-Type Year for the Next Six Months

By: Janus Henderson Investors
Harvest Exchange
September 29, 2017

Emerging Markets Credit View: More of a Carry-Type Year for the Next Six Months

Steve Drew, Head of Emerging Market (EM) Credit, explains why the current macro backdrop for emerging markets should remain benign and where he sees the sweet spots for investments in his asset class. While he expects some kind of volatility spike before the year end, most likely from geopolitical developments, given the strong fundamental and technical picture in the asset class, he believes it will prove to be a buying opportunity.

Key points:

• Both fundamentals and technicals are strong in emerging markets

• Rate hikes in the US probably limited to just one more for the near future

• The US dollar will likely remain stable to weak, benefiting EM currencies and hence EM debt

• Current sweet spots of investments look to be in BB emerging market credits

Originally Published at: Emerging Markets Credit View: More of a Carry-Type Year for the Next Six Months