Global Investing

Weekly Radar: A ‘sudden stop’ in emerging markets?

June 6, 2013

Turkey’s lira, South Africa’s rand and South Korea’s won have all lunged, local currency debt yields have suddenly surged, there’s an intense investor focus on domestic political risks again and governments like Brazil who were taxing what they feared were excessive foreign investment over the past couple of years have U-turned as those flows evaporate. 

Guarding against the inflation dog in emerging markets

June 6, 2013

The dog that didn’t bark was how the IMF described inflation. But might the fall in emerging market currencies reverse the current picture of largely benign inflation?

No more currency war. Mantega dumps the IOF

June 5, 2013

Brazil’s finance minister Guido Mantega, one of the most shrill critics of Western money-printing, has decided to repeal the so-called IOF tax, he imposed almost three years ago as a measure to fend off  hot money flows.

Emerging local debt: hedges needed

June 5, 2013

The fierce sell-off that hit emerging market local currency debt last month was possibly down to low levels of currency hedging by investors, JPMorgan says.

The Sub-Saharan frontier: future generations

June 3, 2013

As growth in Sub-Saharan Africa is set to post a steady 5-6 percent per annum to 2017 according to IMF estimates,  investors will be taking notes on the region’s growth story not least with the financial sector.

Cheer up Morocco, frontier markets are hot

June 3, 2013

Morocco fears its stock market is on the verge of being re-classified as a frontier market when  index provider MSCI announces its annual rejig of equity indices this month.

South Africa’s perfect storm

May 30, 2013

Of all the emerging currency and bond markets that are feeling the heat from the dollar’s rise, none is suffering more than South Africa. A series of horrific economic data prints at home, the prospect of more labour unrest and the slump in metals prices are making this a perfect storm for the country’s financial markets.

Hedge fund boss Baha sees gold at $3,000-$5,000

May 28, 2013

Christian Baha, the head of Austrian fund firm Superfund and representative of the hedge fund industry in Oliver Stone movie Wall Street 2: Money Never Sleeps, is predicting that the gold price could rise to between $3,000 and $5,000 over the next five to 10 years.

Not all emerging currencies are equal

May 28, 2013

The received wisdom is dollar strength = weaker emerging market currencies. See here for my colleague Mike Dolan’s take on this. But as Mike’s article does point out, all emerging markets are not equal. It follows therefore that any waves of dollar strength and higher U.S. yields will hit them to varying degrees.

Emerging corporate debt: still booming

May 28, 2013

The corporate bond juggernaut continues apace in emerging markets.

In a note at the end of last week, analysts at Bank of America/Merrill Lynch estimated that companies from the developing world have sold debt worth $179 billion already this year. Originally, the bank had forecast $268 billion in corporate debt issuance in 2013, a touch below last year’s $290 billion but it is finding itself, like many others, marking up its estimates.