EM ASIA FX : Strong USD Undermines Asia Bonds

"EM Asia bonds will get sold off based on the fact
that Yellen's thesis of allowing inflation will cause global
bonds to reprice in the future  inflation premium," said Stephen
Innes, senior FX trader for FX broker OANDA in Singapore.
    "With the solid growth differential offered in EM Asia, I
think the sell-off will be short-lived. Still, we need a
constructive policy direction from the Fed," Innes said.
    The U.S. central bank needs to guide the market to December
lift-off and stop with theoretical concepts, which have been
confusing investors, he said.

  As Thais begin a year of mourning for their king, parties
and celebrations will be toned down, particularly over the next
month, temporarily crimping consumer and tourist spending in an
economy that has been struggling for traction in recent years.
    "Thailand will not only be entering a period of mourning,
but one of dynamic changes and political uncertainty," said Mark
Mobius, executive chairman of Templeton Emerging Markets Group.
    "Under such circumstances, market observers will be looking
out for potential issues over political friction and royal
succession, and investors should be prepared for volatility. In
the long run however, we believe the market uncertainty will
ultimately be outweighed by Thailand's strong fundamentals," he

Stephen Innes

Stephen Innes

Senior Currency Trader and Analyst at OANDA
Stephen has over 25 years of experience in the financial markets and specializes in Asian currencies at OANDA. After having started his trading career with NatWest Bank, he is currently based in Singapore as a Senior Currency Trader and Analyst with OANDA, focusing on the movement of the Aussie Dollar and ASEAN Currencies. Stephen has an extensive trading experience in Interest Rate Futures, Money Markets and Precious Metals. Prior to joining OANDA, he worked with organizations like Cambridge Mercantile, Nat West, Garvin Guy Butler, Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes
Stephen Innes

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