Tight valuations Show How Hot Emerging Market Credit Is

Emerging market debt issuance is expected to slow, but remain elevated from the historical average as EM issuers rush to make the most of low rates and abundant liquidity according to Deutsche Bank credit strategists Hongtao Jiang, Rebecca Klausen, and Viacheslav Shilin. [buffett] It is widely expected that the Federal Reserve will hike interest rates for the third time this year in December, and more hikes are expected next year as the US economic recovery continues. This backdrop of Fed tightening, pose a significant challenge for EM credit in 2018, however, “abundant global liquidity and suppressed European yields” should lead to a continued…