The bank projected emerging market equities could experience the greatest rise at 12% in dollar terms, while EM currencies should strengthen by around 2% on average on economic improvements and a modestly weaker U.S. dollar. Meanwhile, in the local currency bond market, they added that closely tracked GBI-EM debt index could see a 10% rebound on an “unhedged” basis and including “duration effects”.
“The Vanguard FTSE Emerging Markets ETF has received $421 million this month, and the iShares Core MSCI Emerging Markets ETF saw inflows of $2.2 billion — the equivalent of 4.6 percent of its assets under management,” according to Bloomberg.
The recent inflows are reversal of the trend seen earlier this year when investors pulled $10 billion from emerging markets ETFs in the first two quarters of the year.
Courtesy: Bloomberg
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