Connexion
/ Inscription
Mon espace

BNY Mellon's Standish surveys the emerging opportunities in local currency-denominated bonds

ER - Analyses de marchés
ABONNÉS
• Caution on the Eurozone is wise until there is greater policy clarity, says Standish’s Kozhemiakin
• Thus far, a number of emerging economies have remained largely unaffected by Europe’s economic travails
• However, risky asset returns are likely to remain hugely correlated to the news emanating from Europe

Alexander Kozhemiakin, head of emerging markets debt at BNY Mellon’s dedicated fixed income specialist Standish, and manager of the BNY Mellon Emerging Markets Debt Local Currency Fund, looks at attractive investment opportunities in local currency-denominated emerging market bonds.

“With the uncertainty surrounding the outcome of the Eurozone crisis, we remain somewhat cautious about our positioning in the region and will continue to do so until we get more clarity on policy measures,” says Kozhemiakin. “At the same time, the sell-off in emerging currencies has made valuations relatively compelling on a medium- and long-term horizon. Furthermore, we believe that the deteriorating outlook for global economic growth should result in a lower inflationary environment, which could be supportive of local bonds. In addition, we believe that the risk of unanticipated new bond issuance (outside the planned schedule) is low as most emerging economies seem to be in a good fiscal position. Meanwhile, emerging market local currency bonds are helped by the low interest rate environment in the developed economies (with the exception of the peripheral countries in the Eurozone). However, it seems inevitable that risky assets returns will remain highly correlated to news coming from Europe,” he adds.
“To date, we believe that up to now the longer term growth prospects and public debt sustainability of emerging economies have remained largely unaffected by the economic problems in the single currency area,” he says. “Currencies in a few countries have reached quite attractive valuation levels; this includes the Turkish lira, the South African rand, the Brazilian real and the Hungarian forint but we are looking for more clarity on Europe before we decide to take a more aggressive stance in these currencies. In the case of Hungary, we see a better risk/reward trade in being long the Polish zloty. We also like the Mexican peso versus the Peruvian nuevo sol and the Colombian peso. The Mexican peso is undervalued given relatively robust fundamentals, and we suspect that it has sold off in large part because it is a very liquid currency,” Kozhemiakin explains.
“On the duration side, we still like Mexican duration. In keeping with our view on the currency, fundamentals are favourable, for instance with regard to debt dynamics,” he says. “At the same time, we expect that global disinflationary forces combined with subdued domestic demand in Mexico will have a dampening effect on inflation in the country. We see similar dynamics in South Africa.
“We continue to believe that the potential returns offered by the average nominal yield above 6% in local currency bonds, along with the potential for further currency appreciation, make emerging markets local currency denominated debt an attractive investment opportunity,” concludes Kozhemiakin.

Headquartered in Boston, USA, Standish is a specialist active fixed income manager investing in global fixed income markets and across the full credit spectrum.

Lire la suite...


Articles en relation

ER - Analyses de marchés
ABONNES
Nouveau rapport des PRI sur l'investissement responsable dans la dette privée

Les Principes pour l'investissement responsable (PRI) publient « Spotlight on Responsible Investment in Private Debt », un nouveau rapport dont l'objectif est de fournir des grandes lignes directrices et des études de cas sur les meilleures pratiques en termes de mise en œuvre de l'investissement responsable dans le domaine de la dette privée.  Récemment considérée comme une classe d'actifs à part entière, la dette privée recouvre un large éventail de stratégies d'investissement. Parmi les 50...

ER - Analyses de marchés
ABONNES
Que réserve 2019 en matière d'investissement responsable ?

L'intérêt des investisseurs pour l'informatique en nuage, l'apprentissage automatique et le potentiel encore relativement peu exploité de la science des données s'accroît rapidement. Dans un secteur sujet à de profonds changements, la science des données est, grâce aux possibilités qu'elle offre et aux efficiences qu'elle génère, à même de jouer un rôle important. Un commentaire d'Iain Richards, Head of Governance & Responsible Investment chez Columbia Threadneedle Investments Tandis que...

ER - Analyses de marchés
ABONNES
Le point de marché mensuel de Michel Lemosof

Les problèmes qui ont fait chuter les marchés financiers en 2018 n'ont pas disparu d'un coup de baguette magique ! La récession n'est pas au coin de la rue et les indices ont plus baissé que les révisions de résultats des entreprises. Mais l'appétit pour le risque a du mal à se frayer un chemin dans un environnement manquant de visibilité. Luca Paolini, économiste en chef chez Pictet Asset Management, rappelle qu'il est généralement judicieux de se prémunir contre le risque d'événements...

ER - Analyses de marchés
ABONNES
De la bonne valorisation des entreprises non cotées, par Edulis

« En l'absence de marché organisé et de liquidité suffisante, s'interroge Philippe Lagarde, directeur général d'Edulis (spécialiste de l'accompagnement des PME de croissance et du conseil aux investisseurs), comment valoriser correctement une entreprise non cotée ? » Et de fournir des pistes.   Trois approches Valoriser une PME non cotée implique le suivi de critères objectifs afin de parvenir à un « légitime » équilibre et de fédérer les parties autour d'un projet ou d'une transaction....