Investors warn strong US dollar set to hit emerging market bonds
The post Investors warn strong US dollar set to hit emerging market bonds appeared on BitcoinEthereumNews.com.
A Financial Times report revealed that investors are concerned about a stronger US dollar under incoming president Donald Trump’s presidency. The report highlighted that investors expect a stronger dollar to disrupt the returns coming from emerging market bonds. The report revealed that investors are also worried about the possible outflows that a strong dollar could trigger. It pointed out that developed countries have had a long period of high interest rates. A JPMorgan report indicated that higher rates in developed countries attract funds that would have otherwise gone into emerging markets. JPMorgan also released data on net outflows in emerging markets over the past few years. On November 8, emerging market bonds recorded $3.2 billion in net outflows, the largest outflow in about two years. The JPMorgan report mentioned that investors expected emerging market assets to be under pressure from Trump’s policies. This year, the total outflows from emerging market bonds have hit $20 billion, lower than 2023’s $31 billion and 2022’s $90 billion. The global markets have been dealing with Trump trades, which is a euphoric state for investors in stocks, crypto, and equity markets. A Reuters post revealed that tax cuts and less stringent regulations have contributed to the euphoria. However, the expected inflation from Trump’s policies may fuel the strength of the dollar and a spike in U.S. Treasury yields. Several currencies weaken against the US dollar US DOLLAR WRECKING BALL The USD has hurt emerging markets – Mexico, Brazil, China, and even Europe Compare their stock market to the United States Take a look at interest rate cut expectations They have dwindled. So the US Dollar could top out soon$EWZ $EEM $EWW $FXI $SPY… pic.twitter.com/KgUMFAe3gm — Ram Ahluwalia CFA, Lumida (@ramahluwalia) November 22, 2024 Multiple currencies, including the Euro, the Brazilian Real, and the Japanese Yen,…
Filed under: News - @ November 25, 2024 9:18 am