Local currency emerging market debt: deserving of a closer look
With many bond investors caught between concerns over rising interest rates and the belief that the multi-decade bull market in fixed income is not over yet, local currency emerging market debt deserves more attention than it often gets.
Bryan Carter and JC Sambor, Head and Deputy Head of Emerging Market Fixed Income, respectively, share their thoughts on this asset class.
Key points
- Local currency debt has become one of the largest fixed income universes over the past eight years, yet remains underappreciated
- We can see a number of triggers for a pick-up in demand
- We believe growth is the main forward indicator for currencies
- The asset class offers multiple opportunities, collating a heterogeneous group of bond issuers including countries in different stages of the economic and monetary policy cycle
Emerging markets, are likely to display higher-than-average volatility due to a high degree of concentration, increased uncertainties resulting from the lesser amount of information available, any liquidity or more High sensitivity to changes in market conditions (social, political and economic conditions).
Click here to read the report (4 pages)
Expert
Jean-Charles Sambor
Head of Emerging Market Fixed Income
Jean-Charles Sambor is the Head of Emerging Market Fixed Income (EMFI) at BNP Paribas Asset Management. Jean-Charles Sambor has been Deputy Head of Emerging M
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BNP Paribas Asset Management (‘BNPP AM’) is the investment arm of BNP Paribas, a leading banking group in Europe with international reach. BNPP AM aims to generate long-term sustainable returns for its clients, based on a sustainability-driven approach. BNPP AM’s investment capabilities are focused around five key strategies: High Conviction Strategies, Private Assets, Multi-Asset and Systematic & Quantitative Investments (SQI), Emerging Markets and Liquidity Solutions, with investment processes incorporating quantitative and fundamental analysis.
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