Rather, he says, it has come on the back of a broad re-pricing of emerging market risk as concerns about growth have grown. But, he adds, that could change.
“My concern is that the market is still under-pricing the path of US monetary policy. It is not about the first 25 basis points, but rather how the market is anticipating how the Fed is going to hike.
“We think the Fed will have to hike faster than what the market is pricing in at the moment, so you may have some re-pricing coming from the US curve that will affect EM and, indeed, all fixed income asset classes in a negative way.”
