Kazakhstan’s tenge is the latest emerging market domino to fall. Here’s what you need to know February 11, 2014 Crunch time for another emerging market economy. The fall of Kazakhstan's tenge is the latest in a series of currency depreciations to hit emerging markets over the last few weeks. Kazakhstan's central bank governor Kairat Kelimbetov has pledged to "protect the tenge from sharp moves … away from the new level of 185 to [...]
Real emerging market risk is not repeat of 1997 Asian crisis February 3, 2014 Don’t prepare for a reversal in market’s appetite for risk anytime soon TO SOME analysts, the bloodbath in emerging markets over the past fortnight bears uneasy similarities to the early stages of previous full-blown emerging market crises. As a recent note by Brewin Dolphin pointed out, such episodes have historically recurred every 15 years or [...]
Diageo sales hit after emerging markets slow January 30, 2014 DIAGEO shares slid nearly five per cent yesterday after China’s crackdown on gifting and weak beer sales in Nigeria led to lower than expected sales. The Chinese government’s anti-extravagance measures caused sales of its white spirits brand Shui Jing Fang to drop by 66 per cent as a squeeze on the baiju market prompted rival [...]
Emerging market desperation risks a repeat of 1997 Asian crisis blunders January 29, 2014 THE EMERGING market sell-off has prompted central bankers to act. Yesterday, South Africa’s central bank raised its benchmark interest rate by 0.5 percentage points to 5.5 per cent, citing the depreciation of the rand and an increased risk to the country’s inflation outlook. The Reserve Bank of India has also increased its benchmark rate by [...]
London Report: FTSE buoyed by fall in emerging market worries January 28, 2014 THE UK’S blue chip share index picked up yesterday from five-week lows after finding strong technical support in the face of easing tensions in emerging markets and prospects of mergers and acquisitions. Emerging market assets steadied after a three-day slump, reviving confidence in global risk assets and reassuring investors worried that companies will be hit [...]
Sharp emerging market sell-off creates pockets of value for discerning investors January 28, 2014 The recent chaos in emerging markets has brought back uneasy memories of last summer’s sell-off. The MSCI emerging markets index fell from around 1,003 at the beginning of January to less than 932 on Monday, before stabilising in anticipation of the Federal Reserve meeting taking place today and tomorrow. But should investors be put off [...]
Emerging markets need a structural overhaul before they can return to favour January 27, 2014 PEOPLE talk about emerging markets as if they were one homogenous group, but nothing could be further from the truth. The only thing that really links Argentina, Turkey and Indonesia is that they all look vulnerable to further volatility in their currency, bond and equity markets. The diversity of the emerging market universe is such [...]
Investors braced for emerging markets chaos January 27, 2014 INVESTORS are bracing themselves for yet another day of volatility in the financial markets, as political problems in Argentina, Turkey and Ukraine, concerns about slower growth in China and reduced support from US monetary policy spook traders. A full-scale flight from emerging markets accelerated last Friday as shares in major economies were dumped in favour [...]
The Mints are falling apart: It’s time to reassess our view of emerging markets January 26, 2014 TO PARAPHRASE Antony in Julius Caesar, I come to bury the Mints idea, not to praise it. True, as with its Brics ancestor, former Goldman Sachs Asset Management head Jim O’Neill has hit upon something vitally important by identifying Mexico, Indonesia, Nigeria and Turkey as future economic giants. With the Brics, it was that the [...]
Don’t underestimate Turkey’s turmoil: Not all emerging markets will succeed January 8, 2014 TURKEY’S often-fickle political system may not make its current domestic turmoil seem particularly important. But the country’s troubles hold lessons for the likely success – or failure – of other emerging markets in 2014 and beyond. More and more, Turkish Prime Minister Recep Tayyip Erdogan looks like a man who has outlasted his usefulness. If [...]