EM investors would slowly look to rebuild positions in India, be sceptical about China: Geoff Dennis
Geoff Dennis, Independent Emerging Markets Commentator, says even if the dollar gains strength again, it won't rise significantly enough to heavily impact the rupee. A strong rebound in the dollar would mainly affect currencies that have already increased a lot, such as the Brazilian real and the Mexican peso. Therefore, I would cautiously and gradually look to rebuild my positions in India, while remaining skeptical as an emerging market investor about the situation in China.
Today is one of those rare days where we have not had any commentary coming in from Trump this morning with regards to tariffs. But how should one actually brace themselves, given the fact that every day you have a new addition to the tariff list?
Geoff Dennis: Well, there is a lot of uncertainty about tariffs. There is a lot of uncertainty as to what we get with tariffs and when and who will be impacted by it. But at the moment, there is not a lot in the way of a new narrative. If you look at what the markets are doing with bond yields having pulled back in the US from 4.8 to 4.5 for 10 years, the dollar being weaker on the year, particularly since the middle of January, it looks to me that the peak of the Trump trade has passed. We have seen some profit taking, some rotation.
As that happens and some of these emerging markets have benefited from the weaker dollar, investors are still saying we do not know what he is going to do and we have got to wait a little bit longer and therefore, it is a very nervous sort of period where, as I say,
