US elections trigger EM bond outflows - HSBC

Research Team at HSBC, notes that the foreign investors pare their bond holdings in most emerging markets ahead of the US elections while the India government bonds remain the only exception, receiving mild inflows.

Key Quotes

“Outflows may further accelerate, especially in Korea and Mexico, following the recent victory of Trump in the US elections. Overseas investors buy Malaysia sovereign bonds in October, following heavy selling in the previous month.”

“HGBs record mild outflows, despite Hungary’s recent upgrade to full investment grade ratings by Moody’s; tepid outflows are also noted from TURKGBs. France bonds turn most favoured Japanese investment destination in September.”