(29 October 2019 ) DAILY MARKET BRIEF 2:EM currencies driven by global and local factors

The still unresolved trade tensions between the US and China, slowing global growth and central bank easing continue to drive emerging market (EM) currencies. In its latest update of the asset class, CIO is looking what’s in store for Russia, Brazil and South Africa.

Global yields are likely to continue to support EM currencies for the time being, even though the asset class is expected to swing, which CIO strategist Jonas David attributes to “the vagaries of the trade conflict and expectations for the global growth outlook”. Meanwhile, country-specific drivers will impact how individual currencies will perform, he adds.