By Gustavo Medeiros, Ben Underhill
The Emerging View

EM Sovereign Debt: The ultra-marathon runner goes on

Inflation has peaked, the capex supercycle rolls on, and EM fundamentals keep improving. We explain why EM sovereign debt, yielding close to 7%, remains one of the most attractively valued asset classes today.

Subscribe to our insights

Subscribe and get notified as soon as we publish our content

The latest insights from our categories

Weekly investor research

Oil relief welcome before Wednesday’s FOMC

After 13 consecutive nights of strikes, the US paused its attack on Iran over the weekend, welcome relief ahead of Wednesday's FOMC. Elsewhere, Samsung and SK Hynix signed USD 950bn of US supply deals and Bank Indonesia's governor resigned.
Weekly investor research

The arrival of Kimi K3 tests investors’ faith in Jevons’ Paradox

Chinese open-weight model Kimi K3 raises questions over AI lab monetisation, testing investors’ faith in Jevons’ Paradox. The Korean memory stock unwind extends, US CPI turns negative and the Bank of Korea hikes for the first time in three years.
Weekly investor research

Hormuz hostilities and a memory stock correction

US-Iran hostilities push oil back to nearly USD 80 and Korean memory stocks fall in a positioning unwind. SK Hynix’s ADRs debut on Nasdaq, China’s central bank adds to gold, and Ukraine secures EUR 140bn in weaponry pledges at the Ankara NATO summit.

Latest Insights

Market commentary
Market Commentary

Chinese bonds deliver in bear markets

Chinese local currency government bonds are entering JP Morgan’s EM local bond index, the GBI-EM GD, at the end of this month.
Weekly investor research
Weekly investor research

The option value of waiting

High levels of uncertainty are not only associated with a scarcity of facts, but also with high trading costs.
Market commentary
Market Commentary

The power of carry

Quantitative Easing (QE) policies in developed countries triggered a flight from yield in Emerging Markets (EM) as investors pursued capital gains in developed markets instead.
Weekly investor research
Weekly investor research

Habemus trade deals

The signing of the phase one trade deal between the United States (US) and China and the ratification of USMCA by the US Senate reduced tail risks and boosted short term market sentiment.
Weekly investor research
Weekly investor research

Delightful diversification

Often underappreciated, the benefits of diversification in external debt were richly on display in 2019, when the asset class returned 15% despite significant volatility in a number of EM countries, including Argentina.
Emerging view
The Emerging View

The 2020-2024 EM fixed income outlook

Following another year of strong returns, EM fixed income has outperformed developed bond markets by a significant margin over the past four years.
Market commentary
Market Commentary

The opportunity of EM real estate

Lower interest rates in the aftermath of the Global Financial Crisis are increasing the affordability of real estate while rendering conventional liquid fixed income in developed economies (DM) less attractive.