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Why invest in EM local currency debt?

Why invest in EM local currency debt?

🕔10:05, 14.Jan 2022

Disappointing US dollar bond returns in EM local currency debt has led to a decline in flows into the asset class over the past decade. In this paper, we discuss the key reasons to invest in EM local currency debt, some of the factors behind the recent weakness in the asset class returns and prospects for the asset class going forward. 

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Valuation Metrics in Emerging Debt

Valuation Metrics in Emerging Debt

🕔14:53, 7.Dec 2021

The EMBIG-D benchmark spread widened by 17 bps in Q3, ending the quarter at 357 bps. As seen in Exhibit 1, the fair market multiple is the benchmark’s credit spread to the spread that would be required to compensate for

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Debt ceiling spat takes a breather

Debt ceiling spat takes a breather

🕔14:25, 18.Oct 2021

BII Global weekly commentary We believe the debt ceiling dispute will eventually resolve but could trigger more volatility. The broadening economic restart keeps us tactically pro-risk. U.S. job growth slowed sharply in September, but we see it as unlikely to

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External Debt Valuation

External Debt Valuation

🕔14:33, 16.Aug 2021

Valuation Metrics in Emerging Debt: The EMBIG-D benchmark spread tightened by 14 bps in Q2, ending the quarter at 340 bps. As seen in Exhibit 1, the multiple is the benchmark’s credit spread to the spread that would be required

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US debt ceiling deadline could disrupt money markets

US debt ceiling deadline could disrupt money markets

🕔05:06, 27.Jul 2021

Can there be such a thing as too much money? There is certainly a huge amount of money sloshing through the US financial system, which is straining the shortterm funding market and threatening to push short-dated Treasury yields below zero.

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European Infrastructure Debt

European Infrastructure Debt

🕔16:45, 24.Jun 2021

Resilient and essential in the Post-Covid environment As an asset class, infrastructure debt possesses key characteristics that contribute to resilient performance. These include the large physical nature of the underlying asset, high barriers to entry and stable revenues linked to

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Less directional but more relative value opportunities in China

Less directional but more relative value opportunities in China

🕔10:14, 1.Jun 2021

Economic data portrays sustainable growth in China, but it’s still unbalanced and plateauing. It remains driven by manufacturing and exports, but consumption lags, and impacts from ongoing authorities’ targeted deleveraging and reforms are starting to show. They are focused on

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High Yield Debt Can Boost Income And Return Potential Amid Low Yields

High Yield Debt Can Boost Income And Return Potential Amid Low Yields

🕔12:47, 29.Apr 2021

Downside risk management is crucial.  Volatility and low yields are likely to persist over the next few years as the global economy recovers from the shock of the coronavirus. Navigating this environment will be difficult, particularly as returns from equities

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Going beyond “active vs. passive” in EM debt

Going beyond “active vs. passive” in EM debt

🕔12:59, 31.Mar 2021

These are promising times for emerging markets (EM) debt, as we see a number of macro factors aligning in a broad tail wind for the sector. EM economic growth is leading the global recovery, yet EM is the only major sector with broadly attractive valuations. In developed markets, while rates have backed up from their extreme lows at the start of the year, monetary policies continue to anchor core …

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Has the Fed Turned Hawkish by Allowing Bond Yields to Surge?

Has the Fed Turned Hawkish by Allowing Bond Yields to Surge?

🕔09:33, 17.Mar 2021

Has the Fed Turned Hawkish by Allowing Bond Yields to Surge? It seems happy to let financial market conditions tighten.  Surging yields on U.S. government debt are tightening financial market conditions, but the response to this from Federal Reserve Chairman

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Chinese SOE Debt

Chinese SOE Debt

🕔08:38, 1.Mar 2021

In our white paper, The Mystery of SOE Debt, published in September 2020, we demonstrated that State-owned Enterprise (SOE) defaults are rare. In this update, we clarify that our SOE investment process excludes SOEs of the variety currently defaulting in China, so we stand …

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The Road Ahead

The Road Ahead

🕔07:37, 29.Oct 2020

“ In fact, Powell noted that the Fed seeks to promote its employment and inflation goals while warding off any risks to financial stability (i.e., asset bubbles) ‘that impede the stability of our goals’. “

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Sustainability Ranking Emerging Countries

Sustainability Ranking Emerging Countries

🕔11:18, 27.Oct 2020

Emerging economies are generally considered to have high potential, notably due to their young and growing population. Although most are not always seen as being sustainable or having a democratic process, integrating sustainability criteria into the management of a portfolio

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Highlights of last week: ESG and a ‘global debt explosion’

Highlights of last week: ESG and a ‘global debt explosion’

🕔08:55, 12.Oct 2020

#41 This week a lot of webinars are being held. For example on Tuesday 13 October Jupiter AM hosts a webinar called “Income: it’s time to think creatively” and on Thursday 15 October T. Rowe Price hosts a webinar called

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Curing What Ails U.S. Healthcare

Curing What Ails U.S. Healthcare

🕔14:38, 8.Oct 2020

Weekly Economic Commentary IN THIS ISSUE: Curing What Ails U.S. Healthcare Child Care Is A Global Economic Issue When It Comes To The U.S. National Debt, History Will Not Repeat No one can avoid the doctor’s office forever. Whether for

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Implications of the global debt explosion

Implications of the global debt explosion

🕔09:48, 8.Oct 2020

European Gazette  Global debt was at an unprecedented level before Covid-19. With the subsequent policy response injecting liquidity into most parts of the world economy, the debt predicament is set for a worse path. We explore the implications for sovereigns,

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Enduring Yield: European Commercial Real Estate Debt

Enduring Yield: European Commercial Real Estate Debt

🕔09:37, 21.Sep 2020

The European real-estate debt market has changed dramatically since the Global Financial Crisis, with bank lending activity – constrained by regulatory capital and oversight – creating a structural opportunity for non-bank lenders to exploit. As such, we believe European commercial

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Rising debt, weak growth highlight active selection

Rising debt, weak growth highlight active selection

🕔07:54, 16.Sep 2020

Winners vs. Losers in Credit The extraordinary monetary and fiscal policy measures enacted during the pandemic have added further impetus to the trend of rising corporate debt and less stringent lending standards that began in the aftermath of the global

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Sovereign Contingent Bonds: How Emerging Countries Might Prepay for Debt Relief

Sovereign Contingent Bonds: How Emerging Countries Might Prepay for Debt Relief

🕔09:57, 25.Aug 2020

Emerging countries have been in the midst of a crisis that is not of their own making. A great majority of these countries are navigating the crisis fairly well. Others are struggling, and a few have defaulted on their external

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Fixed Income Asset Allocation Insights

Fixed Income Asset Allocation Insights

🕔15:12, 19.Aug 2020

Evaluating the four P's (Pandemic, Policy, Pricing and Portfolios)  The first half of this year has been dominated by the spreading coronavirus pandemic and the policy response to it. The latter has been overwhelming; both monetary and fiscal policy are

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‘Don’t cry for me Argentina’ in een nieuw schuldendrama

‘Don’t cry for me Argentina’ in een nieuw schuldendrama

🕔15:00, 17.Jul 2020

Wederom staat Argentinië aan de rand van een schuldencrisis. De lage waarderingen van effecten bieden instapkansen, maar beleggers moeten zich wel instellen op grote volatiliteit. Een positieve uitkomst in de opgeschorte onderhandelingen met internationale …

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Global debt flows – The big mend continues

Global debt flows – The big mend continues

🕔10:40, 3.Jun 2020

Covid-19 effects so far centre on flight into short-end government bonds and equivalents, a measure of safety flight. At the same time there has been resumed risk-on in the guise of strong inflows to dollar high yield and corporates generally.

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Bitcoins, central banks and inflation expectations: a variety of topics in our Top Five

Bitcoins, central banks and inflation expectations: a variety of topics in our Top Five

🕔10:12, 16.May 2020

#20 – Top Five Best Read Research on OpinioPro And it’s Saturday again: the day for us to publish our Top Five Best Read on OpinioPro this last week. Populair tags were ‘asset allocation‘ and ‘equities‘, furthermore our event calendar

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Sovereign debt risk after the virus

Sovereign debt risk after the virus

🕔17:14, 11.May 2020

How governments were placed on the eve of the coronavirus pandemic will play a significant role in how they emerge from the crisis. The global health crisis triggered by the coronavirus pandemic has firmly put the spotlight on how well

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Who decides on ECB purchases?

Who decides on ECB purchases?

🕔08:34, 11.May 2020

Week Ahead Focus: German Federal Constitutional Court ruling, US Labor Market Report, Eurozone public debt This week, the German Federal Constitutional Court ruled on a lawsuit against the purchase of government bonds by the ECB and thus the Bundesbank under

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Week #18 – Top Five Best Read Research on OpinioPro

Week #18 – Top Five Best Read Research on OpinioPro

🕔10:00, 2.May 2020

#18 This week we start with the Number One Best Read Research on OpinioPro, which is not by an asset manager or financial institution. It’s a research paper by the Blavatnik School of Government and the University of Oxford called:

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Week #17 – Top Five Best Read Research on OpinioPro

Week #17 – Top Five Best Read Research on OpinioPro

🕔10:20, 25.Apr 2020

#17 It’s time for the best read research again! But let’s start with an article that was read the longest: “Credit markets will remain challenged amid market volatility from COVID-19” by Capital Group. While this article was published in March,

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COVID-19: Uncharted Waters for the Economy and Markets

COVID-19: Uncharted Waters for the Economy and Markets

🕔15:57, 13.Apr 2020

QMA’s Global Multi-Asset Solutions Group The rapid spread of the coronavirus has triggered a global health crisis, rocked global financial markets, and caused a sudden stop in the global …

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Real Asset Debt: Lessons from Manager Selection

Real Asset Debt: Lessons from Manager Selection

🕔11:42, 6.Feb 2020

Why read on? At bfinance, 2019 brought the first ever year in which searches conducted by investors for “Real Asset Debt” outweighed, in dollar terms, searches for corporate Private Debt. Recent appetite for real asset debt, and particularly infrastructure debt,

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Do highly indebted large corporations pose a systemic risk?

Do highly indebted large corporations pose a systemic risk?

🕔07:35, 22.Jan 2020

At the end of 2018, “at-risk” firms in France were estimated to have total gross debts of EUR 187 billion. A 100 basis-point rise in their cost of financing could push this amount up by 60%, potentially posing a risk

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Lebanon in the eye of the storm

Lebanon in the eye of the storm

🕔08:08, 9.Dec 2019

Research & Strategy Insights  Key points • Lebanon is experiencing its largest street protests since the end of the civil war. The country is struggling with economic stagnation, and its fractious and corrupted political system has failed to address rising

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Striking the Right Balance

Striking the Right Balance

🕔17:27, 19.Jul 2019

Global outlook In This Report The prospect of a downturn almost appears to have been factored in as an inevitability due to the length of the current real estate cycle, and sentiment is under pressure from weaker news on global

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Uncommon truths – Global debt review 2019

Uncommon truths – Global debt review 2019

🕔19:02, 30.Jun 2019

The global debt burden again fell slightly in 2018, with notable declines in some European countries. Emerging market (EM) countries have less debt but offer higher real yields. Some so-called “safehavens” have surprising amounts of debt.

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Sinology

Sinology

🕔15:03, 2.Jun 2019

China’s debt problem is serious, but the risk of a hard landing or banking crisis is, in my view, low. The reason is that the potential bad debts are corporate, not household, debts and were made at the direction of

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Infrastructure debt Insurance regulations in Asia

Infrastructure debt Insurance regulations in Asia

🕔05:00, 30.May 2019

Across Asia, new risk-based insurance regulations are in various stages of development. From experience in Europe, we know that implementation of these new rules could have a profound impact on insurers’ investment strategy. In the fast-growing Asian insurance market, a

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European distressed debt investing in a late-cycle environment

European distressed debt investing in a late-cycle environment

🕔14:02, 6.May 2019

How ‘late’ are we in the current cycle? Investors have tended to focus on strong economic fundamentals and healthy corporate earnings rather than worrying about the adverse impact of rising interest rates and higher inflation on asset prices. More recently

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The stabilisation of global debt

The stabilisation of global debt

🕔01:02, 12.Aug 2018

Uncommon truths The global debt burden fell in 2017, with notable declines in some European countries (it was stable in China). Emerging market (EM) countries have less debt but offer higher real yields. We continue to believe EM debt offers

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Debt of non-financial corporations

Debt of non-financial corporations

🕔15:27, 4.Jul 2018

Macroeconomic measures of debt are based on the financial accounts of a country or economic area, as these provide comprehensive data on the financial assets and liabilities of the economy broken down by institutional sector (i.e. households, non-financial corporations, financial

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Asian Debt is meer dan een nichemarkt

Asian Debt is meer dan een nichemarkt

🕔10:16, 12.Apr 2018

De categorie Asian Debt, met een marktkapitalisatie van bijna 1 biljoen dollar (USD 886,7 miljard per 31 maart 2018), is niet langer een niche Asian Debt bleef ondanks de hogere volatiliteit aan het begin van 2018 relatief veerkrachtig, dankzij de

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Eaton Vance Emerging Markets Local Income (EMLI) strategy: Casting the widest net in emerging-markets debt.

Eaton Vance Emerging Markets Local Income (EMLI) strategy: Casting the widest net in emerging-markets debt.

🕔13:02, 21.Feb 2018

The great majority of EM local currency strategies are confined largely to the 18 countries in the JP Morgan Government Bond Index – Emerging Markets (GBIEM) Global Diversified benchmark, which concentrates risk among the 10 largest issuers. Investors were drawn

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The 2018 Global Ranking

The 2018 Global Ranking

🕔07:03, 10.Feb 2018

The Worst and Best Places in the World to Collect Your Debts This second edition of the Euler Hermes Collection Complexity analysis looks into debt collection procedures in 50 countries (*).Sweden, Germany, and Ireland take the lead of our ranking

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Deconstructing infrastructure debt

Deconstructing infrastructure debt

🕔14:18, 30.Nov 2017

For many investors, infrastructure allocations fall short of their targets. One way to broaden the opportunity set is by looking beyond equity. Infrastructure debt takes many forms. Ratings range from below investment grade to investment grade, maturities from seven years

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Finding value in emerging markets debt

Finding value in emerging markets debt

🕔14:32, 28.Sep 2017

Buoyed by strong investor inflows, emerging markets debt has delivered strong returns so far this year, with little differentiation across sector, region, or credit quality (see Figure 1). As a consequence of this recent run of positive performance, valuations have

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China’s Rising Presence in Emerging Debt Markets

China’s Rising Presence in Emerging Debt Markets

🕔15:16, 15.Sep 2017

Emerging Debt Insights Countless articles have been written in the past 10 years predicting (or warning) of China’s imminent financial demise, with the number of articles accelerating in recent years amid China’s debt build-up in the post Global Financial Crisis

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A new wind is blowing through infrastructure debts

A new wind is blowing through infrastructure debts

🕔04:38, 13.Apr 2017

Investors are increasingly turning to infrastructure debt, a strong option among alternative asset classes in recent years. Recent political developments in the US and Europe have boosted its attractiveness. Donald Trump has made infrastructure spending a national priority. He has

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Does Greece Need More Offi cial Debt Relief? If So, How Much?

Does Greece Need More Offi cial Debt Relief? If So, How Much?

🕔14:00, 12.Apr 2017

Creditor countries and international organizations continue to disagree whether Greece should receive additional official debt relief, and if so how much. This paper first shows that these disagreements can be attributed to competing assumptions about Greece’s future capacity to repay,

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