VanEck Blogs | Emerging Markets Debt Daily

EMFX implied volatility is not particularly elevated these days. But does this adequately reflect potential risks between now and the rest of the year?

The “peak growth” narrative is gaining popularity, as the global policy bias is becoming less dovish. But inflation might prove more persistent, and this can push EM terminal rates higher.

Chinese authorities are providing ample liquidity and are contemplating counter-cyclical measures to support consumption and growth as the Evergrande saga continues to unfold.

With no end to China/Evergrande contagion fears, the focus shifts to this week’s monetary policy meetings in the U.S. and major EMs.  

China’s Evergrande story is still unfolding, but it is important to remember EM strengths (especially on the external side) which create places to hide when things get tougher.

The Evergrande saga continues to weigh on market sentiment. Would the Fed mention China in its policy comments when it meets next week amidst China contagion risks?