INSUBCONTINENT EXCLUSIVE:
Investors now see Chinese assets, including the yuan and government bonds, as likely to perform poorly.This year, changes in the Federal
Yet, investors think the PBOC has less room to lower rates compared to other major economies.Ken Cheung, a chief strategist at Mizuho Bank
in Hong Kong, believes the yuan will face short-term pressure
(Photo Internet reproduction)Emerging market currencies are becoming less correlated with the yuan, hitting a three-year low
Also, the potential inclusion of South Korea and India in major global bond indices could boost their assets further.Last week disappointed
stimulus have also dampened hopes for more policy support.The offshore yuan has weakened by more than 1% this year, after a nearly 3% drop
in 2023.Rajeev De Mello from Gama Asset Management prefers local currency bonds and currencies from countries like Brazil and Mexico, where
in the first half of the year.They are searching for relative value opportunities, according to Julio Callegari, their Asia fixed income
director.Economists predict the yuan will recover some losses but still underperform against its Asian peers
Bloomberg surveys anticipate a 3.1% drop in the offshore renminbi against the dollar by year-end.Simon Harvey from Monex Europe sees the
Indonesia more attractive, viewing Korean bonds as appealing proxies for U.S
Treasury bonds, suggesting South Korean bonds could outperform as the Federal Reserve begins easing.
