LONDON, Sept 12 (Reuters) – Just as vaccines work by
stimulating the body’s immune system, last year’s selloff may
have helped emerging markets build defences against the damage
they have suffered during past U.S. rate rise cycles.
This week’s market moves are rekindling memories of past
emerging market crises, after a paper from the San Francisco
branch of the U.S. Federal Reserve sparked a surge in the
greenback and U.S. yields, an issue which is likely to be
debated at next weekend’s G20 meeting of world powers.
LONDON, Sept 11 (Reuters) – Emerging stocks eased slightly
to touch new three-week lows on Thursday and most currencies
steadied from large losses earlier in the week but the prospect
of new EU sanctions kept Russian markets under pressure.
The dollar traded just off 14-month highs against a basket
of major currencies and U.S. 10-year yields stood just off
one-month peaks, following robust gains fuelled by a San
Francisco Fed research paper that showed markets could be
underestimating the magnitude and speed of U.S. rate rises next
By Alexander Winning
What are the chances that Western investors will rush back to Russia if a shaky ceasefire in Ukraine leads to a more lasting peace? Pretty slim, judging by a keynote speech at a recent Russia-focused investment conference in London.
Dmitri Trenin, director of the Carnegie Moscow Centre, told the conference organised by Sberbank CIB, the investment-banking arm of Russia’s top state-controlled lender, there was little prospect of significant Western investment in Russia over the next 5 years:
LONDON, Sept 10 (Reuters) – The cost of hedging against
sharp fluctuations in many emerging-market currencies jumped to
multi-month highs on Wednesday, and derivatives markets indicate
that bets against them are on the rise as the dollar
A rising dollar and higher Treasury yields are spooking
investors engaged in dollar-based carry trades – borrowing at
low interest rates to invest in a higher-yielding, riskier
asset. The result has been a sudden spike in volatility, after
it spent the summer trading near long-term lows.
LONDON, Sept 10 (Reuters) – Emerging currencies fell more
than 1 percent on Wednesday and currencies such as the lira and
rand extended losses to trade at multi-month lows on growing
expectations of a broad-based rally in the U.S. dollar.
The dollar is near 14-month highs versus a basket of major
currencies and could breach levels not seen since 2010 after a
paper from the San Francisco Fed indicated markets are well
behind the curve in pricing the U.S. rate rise trajectory.
LONDON, Sept 8 (Reuters) – Russian shares and the rouble
edged lower on Monday as a ceasefire in Ukraine appeared to be
largely holding, while easy global monetary policy kept eastern
European bonds and emerging stocks near multi-year highs.
Though emerging markets, especially in Europe, are
vulnerable to loss of trade and other pressures stemming from
Ukraine’s conflict with pro-Russian rebels, they are still
supported by the stream of cheap cash from developed world
LONDON, Sept 3 (Reuters) – Peru’s economic growth pace may
slow to 4 percent in 2014, less than previously expected, but
easing inflation is offering room to ease monetary policy,
central bank governor Julio Velarde said in an interview.
Speaking to Reuters and Reuters Television on the sidelines
of an investment conference in London on Thursday, Velarde said:
“What we are seeing gives us more room for expansionary monetary
policies … if inflation is negative it gives us more room.”
LONDON, Sept 3 (Reuters) – Russian and Ukrainian bonds
rallied on Wednesday, and Moscow-listed shares leapt 4 percent
after Kiev said a “permanent ceasefire” had been agreed in the
Donbass area, the news also sparking gains across emerging
The Kremlin watered down the talk of a formal ceasefire, but
it confirmed that steps for peace had been discussed.
LONDON/KIEV Sept 1 (Reuters) – Global investors’ view of
Ukrainian bonds as a relatively safe bet anchored by Western
support is taking a battering as the country’s economic gloom
deepens, with many starting to brace for some form of debt
Fund managers, among whom Templeton’s Michael Hasenstab is
prominent, have until now figured that Ukraine would avert
all-out war with Russia, allowing its economy to recover.
Second, they have reckoned the International Monetary Fund,
which has pledged a $17 billion loan deal, has Ukraine’s back.
LONDON, Aug 29 (Reuters) – Military tensions and a worsening
economy put Russian dollar-denominated stocks on track on Friday
for a 4 percent loss on the month, bucking broader emerging
equities that were poised for their seventh straight month of
Russia stands accused of sending troops into Ukraine to
shore up a separatist rebellion that had appeared to be ebbing.
That has sharply escalated the five-month conflict over eastern
Ukraine and raised the spectre of fresh sanctions from the West.