More Risk Just Fine for EM Investors, Pimco Analysts Say
(Bloomberg) -- Emerging-market outlook remains constructive and global policy shifts may provide attractive entry points, Pimco emerging-markets money managers Yacov Arnopolin, Lupin Rahman and Vinicius Silva write in note.
- Emerging-market central banks meeting target rates for lower inflation as governments cut current account deficits, says note summing up IMF/World Bank investment meetings last week
- EM local debt favored over developed-market bonds and EM hard-currency debt
- China corporate leverage a risk, but no "major crisis" expected
- Commodities not top-of-mind; oil prices expected to stay range-bound
- Nafta negotiation outcome and Mexican election increase uncertainty
- Venezuela still a "riddle;" keeping an eye on sanctions and contraction of oil production
- Latin America upswing focused on reforms surviving; investors remain bullish on region with added risk in near term on local markets and hard-currency debt
- Nations with IMF lifeline are popular, including Egypt and Ukraine, though they face close scrutiny
To contact the reporter on this story: Daniela Guzman in New York at dguzman26@bloomberg.net To contact the editors responsible for this story: Rita Nazareth at rnazareth@bloomberg.net Alec D.B. McCabe
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HALISTER1Source: BFW (Bloomberg First Word)
People Lupin Rahman (Pacific Investment Management Co LLC)
Yacov Arnopolin (Pacific Investment Management Co LLC)
Vinicius Malhaes Da Silva (Pacific Investment Management Co LLC)
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