Political risks appear to be rising in emerging markets, but how do you measure them?
Protests in Egypt – leading to the ousting of a second president in as many years- Turkey and Brazil have caught investors on the hop this year, causing the kind of market volatility that emerging market bulls had been saying were a thing of the past.
LONDON, July 2 (Reuters) – Developing countries that did not
take advantage of historically low yields by selling
international bonds in the first half of 2013 are finding
themselves left high and dry as borrowing costs rise.
Emerging market borrowers sold more than $200 billion of
bonds between January and July, a record-breaking streak that
culminated in April with the startling sight of Rwanda issuing a
10-year dollar bond at a yield of less than 7 percent.
LONDON (Reuters) – Hard to enter and hard to leave, frontier stock markets from Bulgaria to Pakistan have attracted investors who are in for the long haul, keeping them clear of the worst of the markets storm.
While these less-developed emerging markets suffer from a lack of liquidity, with buyers and sellers struggling to match up at times, that can be a bonus when nervous investors are dashing for the exits elsewhere.
LONDON, June 21 (Reuters) – Bangladesh will delay launching
a debut international dollar bond until after the country’s
upcoming elections, its central bank governor said on Friday.
The south Asian country is one of many frontier economies
which have issued or planned international debt in the past
couple of years, to capitalise on investors’ search for
LONDON, June 20 (Reuters) – Stocks and bond prices plunged
and debt insurance costs soared in a general flight from
emerging markets on Thursday, after the U.S. Federal Reserve
laid out a timetable for turning off the taps on its $85
billion-a-month bond-buying programme.
The MSCI emerging stock index was down by over 3.3
percent, hitting its lowest level since July 2012 and heading
for its biggest one-day fall since Oct 2011, with weekly losses
of more than 6 percent, as U.S. 10-year Treasury yields
surged to 15-month highs.
LONDON (Reuters) – Developed world mining and energy companies operating in Africa should pay more taxes to help the world’s poorest continent climb out of poverty, the president of the African Development Bank said on Sunday.
“The reality is, Africa is being ripped off big time,” African Development Bank president Donald Kaberuka told Reuters, a day after attending a meeting in London with other African representatives ahead of the G8 summit of rich countries on the “triple-T” agenda of trade, transparency and tax.
LONDON, June 13 (Reuters) – Emerging market stocks dropped
on Thursday and local currencies came under pressure as
investors piled into the relative safety of the Japanese yen,
driven by a host of doubts over central bank moves around the
Central banks from India to Turkey have acted this week to
stem currency losses, and on Thursday the Indonesian rupiah was
boosted by a surprise central bank rate hike.
LONDON, June 12 (Reuters) – Emerging equities hit 9-month
lows for a second day on Wednesday on a continuing flight from
high-yield assets before recouping some losses, bolstered by a
slight recovery in Turkey and Russia.
Emerging market assets have been hard-hit by expectations
the U.S. Federal Reserve will scale back quantitative easing,
encouraging money to return home to the United States, and by
lower growth in key commodity export market China.
LONDON, June 11 (Reuters) – The transformation of Turkey in
less than a month from newly-minted investment grade darling to
market struggler has again put the role of ratings agencies
Turkey won a coveted second investment grade rating from
Moody’s in mid-May, a decision which swept Turkish bond yields
to record lows and stock markets to all-time peaks.
LONDON, June 10 (Reuters) – Colombia’s economy faces its
greatest risks this year from instability in neighbouring
Venezuela and the slump in commodity prices, the country’s
finance minister said on Monday.
Growth forecasts for the Andean country are likely to be
downgraded, with 4.4-4.5 percent a likely rate for 2013,
Mauricio Cardenas told Reuters editors and Reuters Television.