The material risks to emerging debt markets

Currency fluctuations a key concern

Colm McDonagh, head of emerging market fixed income at Insight Investment, explores how emerging market growth, currency fluctuations and Federal Reserve policy could derail the region's debt markets

It has been a challenging time for emerging market debt during the first six months of 2015, where returns in the major indices range from marginally positive in external debt to negative in local rates.  There have been many issues under scrutiny so far this year, including the threat of disinflation in the wake of European quantitative easing; the prospects for US economic growth, and how the Federal Reserve might normalise interest rates; the strength of and prospects for the US dollar; weakness in commodity prices; a sell-off in developed market bonds; emerging market growth concerns...