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Renewed wave of emerging market currency weakness brewing, says Citi

·1 min read

LONDON, Feb 17 (Reuters) - Citigroup predicted arenewed wave of emerging market currency weakness due to rise inU.S. bond yields on Wednesday, as it took profit onrecently-implemented short positions on the euro against theIsraeli shekel and Turkish lira.

The bank initiated the trades on Feb. 1 at a spot price of3.98 and 8.66, respectively, and the pairs now trade at 3.92 and8.44. That gave profit of 1.5% and 3.3%, respectively, it said.

"We see another wave of EMFX weakness brewing now, as riskappetite is curbed due to the rise in U.S. nominal yields," LuisCosta, emerging markets strategist at Citi, wrote in a researchnote.(Reporting by Tom Arnold; editing by Marc Jones)