EM technicals provide rates buffer

摘要

Risks in emerging markets are on the rise as the Federal Reserve prepares to tighten monetary policy, but strong technicals may prove more supportive than some think. Fears are growing that the emerging markets could experience a repeat of the panic-driven sell-off of two years ago as rising Treasury and Bund yields dominate the landscape. But while the backdrop is extremely unpredictable and some issuers are seeing their bonds sink in secondary trading, the primary market continues to be active with recent big deals performing steadily, underscored by investor cash piles that have grown this year despite a recent bout of heavy weekly outflows.