Tuesday 18 February 2014

An EM credit crunch, not a sudden stop | FT Alphaville

An EM credit crunch, not a sudden stop | FT Alphaville:



"This post by Gavyn Davies has been cross-published at Gavyn’s own blog.



The crisis in the emerging markets’ “fragile 8″ , which threatened to sweep all before it a few weeks back, seems to have settled down almost as quickly as it erupted onto the scene. Investors are already asking whether it is now safe to enter the undoubted attractive valuations in the emerging world.



After the latest rally, emerging assets have performed almost in line with developed equities since the beginning of the year, and there has been little sign of the sudden jump in correlations between countries with good and bad fundamentals that is the hallmark of a genuine crisis in the emerging world. After all the hype, surely that cannot be the end of it, can it?"



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