Vanguard Emerging Markets Govt Bd ETF
Could China Attract Higher Inflows after Bond Market Reforms?
The yuan remains a focus of attention of the international community and a key risk for China’s macroeconomic stability in recent years.
What Difference Does Index Inclusion Make?
Government bond yields in China are higher than its Asian counterparts such as South Korea and Singapore and much higher than major developed markets.
Bond Market Reform Is a Priority for Policymakers
In the third and final phase of bond (EMB) reforms that began after 2015, the substantial activities of the market were open to global investors.
China’s Baby Steps to Open Its Onshore Bond Market
The opening of China’s onshore bond market (EMB) (PCY) was a gradual process that included a number of cautious measures.
Inclusion of Chinese Onshore Bonds in Global Indexes
In March 2017, Citi’s fixed income indexes decided to include onshore Chinese bonds (EMB) (PCY) in its three government bond indexes.
China’s Onshore Bond Market Reforms
China’s onshore bond market (EMB), consisting of locally denominated and issued bonds, is larger than the offshore bond market.
Why Attractive Yields Are Supporting the Emerging Market Rally
Negative bond yields in Japan and the Eurozone, coupled with very low federal funds rates in the United States, are part of why emerging market bonds and currencies have performed so well in 2016.
Quality May Provide Attractive Risk-Adjusted Returns
It’s useful to analyze the historical returns of credit rating categories within emerging markets bonds.
Emerging Market Bonds: Higher Yields Could Reflect Higher Risks
Emerging market bonds have been doing extremely well over the past couple of months. EM debt funds have been in the green for seven consecutive weeks.
Why Does Emerging Market Debt Still Look Attractive?
Emerging market debt (EMB) offers plenty of opportunities to investors. Markets are expected to continue their outperformance for the next few quarters.
Intense Search for Yield Leads to Emerging Market Debt
Under the current uncertain economic circumstances, investors flocked to emerging market debts in search of higher yields.
Central and Eastern Europe Have the Brexit Blues
In the long term, Eastern Europe is largely affected by the United Kingdom’s exit from the European Union because of its strong trade links.
How Negative Rates Intensify the Hunt for Yield
By early July, some $11.5 trillion in bonds were trading at negative rates, with 58% of the Barclays US Aggregate Bond Index1 trading below 1%.
Time to Look at Emerging Market Debt
Global emerging markets (“EM”) debt, both hard and local currency, rebounded strongly in June after a significant retracement in May.