“The growth story in EMs is also generally improving following weakness last year. We see policy easing underpinning a modest growth reacceleration in China during the first half of 2019. More steady growth in EMs should help cushion slowing global growth,” the BlackRock strategists said.

ETF investors who are interested in gaining exposure to emerging market debt have a number options to choose from. For example, the iShares J.P. Morgan USD Emerging Markets Bond ETF (NASDAQ: EMB) provides a direct play to a diversified portfolio of U.S. dollar-denominated emerging market bonds. The iShares J.P. Morgan EM Local Currency Bond ETF (NYSEArca: LEMB), on the other hand, is comprised of local currency-denominated emerging market bonds, which may be more susceptible to currency risks. Additionally, the more focused iShares J.P. Morgan EM Corporate Bond ETF (BATS: CEMB) provides access the emerging market corporate debt.

“A relatively stable USD outlook means no clear advantage in hard- over local-currency EMD,” the strategists added.

For more information on the fixed-income space, visit our bond ETFs category.

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