Back to the complete issue
Wednesday, 5 April 2017

EM currencies vulnerable this week?

What is happening with EM currencies?Emerging market currencies are vulnerable this week, Dimitra DeFotis writes in Barron’s, citing a report from Brown Brothers Harriman (BBH) global currency strategy team. “EM FX was mixed last week, and remains vulnerable as this week begins. The rebound in oil helped some, such as the Colombian peso (COP), the Russian ruble (RUB), and the Mexican peso (MXN). On the other hand, idiosyncratic political risks weighed on South Africa. That is likely to persist as the South African rand is trading at its weakest level since January 16 and is on track to test this year’s low,” the report notes. The BBH warning came despite The FT saying a few days ago that emerging market currencies are on course for their second best quarter in the last five years. Goldman Sachs analysts had said “together with the recent improvement in EM current account balances, we argue that EM economies are less susceptible to the funding shocks often associated with rising US interest rates.” Doing even better that EM currencies are stock, which were poised to clock their best quarter in five years.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.