Turkey’s current account deficit was at 4.8 of GDP but fell to a 27-month low in January. Lower domestic demand and greater exports, supported by a weak lira, have helped reduce the deficit. However, as the country relies on oil imports, any changes in oil prices could weigh on the economy. South Africa is the member of the Fragile Three. [Fragile Three ETFs Face Trade Deficits]
Bolstering the case for DBEM is that emerging markets central banks are not shying away from cutting interest rates to support exporters. This year, central banks in China, South Korea, India, Russia and Thailand, all members of the MSCI Emerging Markets Index, have lowered rates.
Investors are warming to idea of DBEM as a way to play resurgent developing world equities in a strong dollar environment. The ETF has $174 million in assets under management, over $120 million of which has come into the fund this year.
Deutsche X-trackers MSCI Emerging Markets Hedged Equity ETF