Global Investing

India, a hawk among central bank doves

July 31, 2012

So India has not joined emerging central banks’ rate-cutting spree .  After recent rate cuts in Brazil, South Korea, South Africa, Philippines and Colombia, and others signalling their worries over the state of economic growth,  hawks are in short supply among the world’s increasingly dovish central banks. But the Reserve Bank of India is one.

Mrs Watanabe in Istanbul

July 30, 2012

Japanese mom-and-pop investors’ penchant for seeking high-yield investments overseas is well known. Mrs Watanabe (as the canny player of currency and exchange rate arbitrage has come to be known) invests billions of yen overseas every year via  so-called uridashi bonds, debt denominated in currencies with high yields.  Data shows the lira has suddenly become the red-hot favourite with uridashi investors this year.

Emerging market debt with silver pedigree

July 30, 2012

Guarantees on emerging market debt need to be silver-plated these days after the defaults of Ukraine’s state energy firm Naftogaz and Kazakhstan’s BTA bank in recent years show implied guarantees are not worth the paper that they weren’t even written on.

GUEST BLOG: The missing reform in the Kay Review

July 26, 2012

Simon Wong is partner at investment firm Governance for Owners, adjunct professor of law at Northwestern University School of Law, and visiting fellow at the London School of Economics. He can be found on Twitter at @SimonCYWong. The opinions expressed reflect his personal views only.

Emerging debt default rates on the rise

July 24, 2012

Times are tough and unsurprisingly, default rates among emerging market companies are rising.

Risks loom for South Africa’s bond rally

July 23, 2012

Investors are wondering how much longer the rally in South Africa’s local bond markets will last.

South Africa’s joins the rate cutting spree

July 19, 2012

Another central bank has caved in and cut interest rates — South Africa lowered its key rate to a record low of 5 percent at Thursday’s meeting. In doing so, the central bank noted growth was slowing further. ”Negative spillover effects (from the global economy)  likely to intensify,” it said.

Iran air strike bets on the rise

July 19, 2012

Investors are placing larger bets on the chances of an Israeli or U.S. air strike on Iran by the end of the year after a bomb on a bus carrying Israeli tourists in Bulgaria  killed seven people yesterday.

Yield-hungry funds lend $2bln to Ukraine

July 18, 2012

Investors just cannot get enough of emerging market bonds. Ukraine, possibly one of the weakest of the big economies in the developing world, this week returned to global capital markets for the first time in a year , selling $2 billion in 5-year dollar bonds.  Investors placed orders for seven times that amount, lured doubtless by the 9.25 percent yield on offer.

Doves to rule the roost in emerging markets

July 18, 2012

Interest rate meetings are coming up this week in Turkey,  South Africa and Mexico.  Most analysts expect no change to interest rates in any of the three countries.  But chances are, the worsening global growth picture will force policymakers to soften their tone from previous months; indeed forwards markets are actually pricing an 18-20 basis-point interest rate cut in South Africa.