Posted 12/10/2023, 1:00:00 PM
Emerging Market Bonds Attract Investors Betting on Higher Yields and Fed Policy Shifts
- Local bonds from emerging markets are attracting investors looking to profit from shifting monetary policies and higher yields.
- Latin American bonds have posted huge rallies in 2022 as central banks hike and cut rates faster than developed markets.
- Investors are betting on another emerging market bond rally in 2024 as expectations grow for Fed rate cuts and dollar weakness.
- Strategists favor Latin America but also see opportunities in Asia and parts of Europe like Turkey, Czech Republic, and Hungary.
- Emerging market governments eagerly tapping domestic bond markets for financing rather than relying on external debt.