Pakistani stock prices in US dollar terms are currently 20% lower than their January high and 56% lower than their 2017 high (Chart I-1, top panel). Meanwhile, the government projected a contraction in real GDP during the fiscal year 2019…
Investors should stay long local currency government bonds and continue overweighting the nation’s sovereign credit within the EM sovereign credit universe. Ukraine is pursuing prudent fiscal policy under the auspices of the IMF…
Highlights Egypt’s balance of payments have deteriorated materially due to both the crash in oil prices and the global pandemic. The country’s foreign funding requirements in 2020 are high and the currency is under…
Highlights If the current low oil price environment is transitory, temporary fiscal tightening can be used to preserve the exchange rate peg. In our view, low oil prices are structural - crude prices will likely average $40 and lower…
Like many EM bourses, Vietnamese stocks have plunged 35% over the past two months in US dollar terms. How should investors now position themselves with regard to Vietnamese equities, in both absolute and relative terms? In absolute terms…
Chart III-1Downside Risks to Bond Prices Our view remains that debt negotiations will be drawn-out because the Argentine government is both unwilling and lacks the financial capacity to service public foreign debt. The…
Chart II-1Inflation Will Fall Further EM fixed-income investors should buy Ukraine local currency government bonds as well as overweight Ukraine sovereign credit within an EM credit portfolio. The exchange rate is the key for…
Highlights We are upgrading Pakistani equities to overweight within an EM equity portfolio. Fixed-income investors should consider purchasing 5-year local currency government bonds. The balance-of-payments adjustment is probably over…
Feature Chart I-1Lebanese Bond Yields Have Surged To Precarious Levels In a May 2018 Special Report, we warned that a devaluation and government default were only a matter of time in Lebanon. The country's sovereign US…
The latest rout in Argentine markets has brought fears of another sovereign debt default or restructuring. Are conditions right for buying Argentine markets? Politics complicate the assessment of a debt restructuring and we do not…