INSUBCONTINENT EXCLUSIVE:
Bloomberg|Updated: Aug 17, 2018, 07.16 PM ISTEM Asia is at a crossroads in terms of risk appetite, with the trade dispute and dollar
moves.By Liau Y-Sing and Kartik GoyalFrom a rising dollar to an escalating trade war, emerging Asian bonds and currencies have had nothing
Investors in the region are bracing for more - at least in the near-term.
A series of Bloomberg News interviews with fund managers from
Pacific Investment Management Co
to Amundi SA shows that trade tensions, tariffs and elections are still seen as the main headwinds to Asian markets
fundamentals will offer a buffer to any volatility.
Here is what eight portfolio managers with Asian investments see in store for emerging
Asian FX and bonds:
PimcoRoland Mieth, emerging markets portfolio manager in Singapore at Pacific Investment Management Co., which oversees
$1.71 trillion:EM Asia is at a crossroads in terms of risk appetite, with the trade dispute, broad dollar moves, Federal Reserve tightening
and expected China growth slowdown the key drivers from now and into 2019How global sentiment evolves over the next 6-12 months will depend
a lot on extent to which China succeeds in easing liquidity conditions, supports growth and allows a weaker CNY without triggering capital
We have a constructive view on fundamentals for most countries across the region, and recognize the cheapness that has been created in
longer, will keep European and Japanese rates relatively low for longer, and cap the rise in EM Asia ratesAmundiEsther Law, a senior
There are still many headlines risks regarding trade wars, sanctions and election risks generally speaking and these are likely to keep EM
threats to Asian FX bonds
InternationalEric Wong, Hong Kong-based fixed-income portfolio manager at Fidelity International which oversees $431 billion:EM Asia will be
turning point with multiple risks over the next 3-6 months, including upcoming mid-term United States elections which may exacerbate the
Inflation is surprising on the upside and growth is not as encouraging
The central bank did the right thing last week by raising policy rates by 50bps, but it is still behind the curve given where they are in
global risk sentiments, currently trade tariffs development is key, sudden shift in policy calibrations by governments and central banks
which manages $540 billion:Near-term difficulties include a strengthening dollar due to rising United States interest rates, escalation of
United States -China trade war and political uncertainties in some emerging economiesCompared to the taper tantrum in 2013, emerging
significantly repriced in recent months resulting in attractive valuations in several markets
will probably be transitory given the relatively strong fundamentals of Asian economiesCross-border outflows from some higher yielding Asian
markets such as Indonesia and India have stabilized in recent weeks, suggesting this will be less of a headwindDeutsche Bank Wealth
ManagementTuan Huynh, chief investment officer for Asia Pacific at Deutsche Bank Wealth Management in Singapore:EM Asia FX are likely to
onshore yuan will be stable with central bank interventionChina government bonds to be supported by monetary easing while sovereign debt of
some other EM Asian economies will be affected by interest-rate hikes amid higher inflation and market volatilityContagion risks from Turkey
with the largest claims in Turkey is 135 billion euros or 6% of their exposure to euro zone countries and so the fallout is unlikely to
cause a euro-zone credit crunchOppenheimer FundsKrishna Memani, New York-based chief investment officer at OppenheimerFunds Inc
which oversees more than $249 billion:Downside from trade war is limited and the United States will face some pressure by mid-term
on countries like Brazil, Argentina, Indonesia
The biggest underperformer in EM has been and likely to remain Turkey where politics is trumping economics and the economic policy
continue to flee Asian emerging marketsEmerging markets contagion: Inflation targeting reins in outflowsHow emerging market investors are
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