In addition to the attractive yields on emerging market domestic treasury bonds, the emerging market currency exposure provides an attractive opportunity and is currently one of the more favorable aspects of the asset class, in our opinion. The underlying fundamentals in emerging market countries continue to improve and point to a cyclical upswing as shown by the Markit Emerging Market Manufacturing Purchasing Managers' Index ending the year at 52.2, the highest level that it has reached all year. We also continue to see healthy export growth numbers, increasing foreign exchange reserves and continued gross domestic product growth in the emerging market bellwethers, China, India, Brazil and Russia. We anticipate this cyclical upswing will be supportive of emerging market assets more generally.
Posted on Monday, February 5, 2018 @ 9:08 AM
Posts are prepared by First Trust Advisors L. P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.