Investors may want to consider the local currency approach again. Utermann expects local currency appreciation to continue in many emerging markets and that could boost ETFs such as the WisdomTree Emerging Markets Local Debt Fund (NYSEArca: ELD), the first actively managed ETF to have over $1 billion in assets under management. All of ELD’s country lineup is rated investment-grade.

In terms of Asia exposure, Malaysia, Indonesia, Thailand, South Korea and the Philippines combine for about 34% of ELD’s weight and of those countries, only Indonesia has a current account deficit.

The $540.3 million WisdomTree Asia Local Debt Fund (NYSEArca: ALD), also actively managed, allocates almost 46% of its weight to those countries, but that ETF is buffered to some degree by a combined 29% weight to AAA-rated Australia, Singapore and Hong Kong. [A Surprising Bond ETF Safe Haven]

The passively managed Market Vectors Emerging Markets Local Currency Bond ETF (NYSEArca: EMLC) has just a 5.7% weight to Indonesia with an effective duration of 4.74% years and a 30-day SEC yield of 5.47%.

PowerShares Emerging Markets Sovereign Debt Portfolio

Tom Lydon’s clients own shares of EMB.