Government Reform Driving Biggest Returns in EM Bond Markets
- Investors have slowed chasing high yields in emerging markets
- Argentina, Turkey and Egypt bonds among recent top performers
Bond investors are signaling that good government counts for more than monetary policy in emerging markets.
Since the start of April, investors have started to more aggressively sell bonds from high-yielding countries where governments have loosened fiscal policies. They’re also willing to buy debt with low or even negative yields, as long as the countries are pushing for fiscal vigilance.