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


This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Stephen Innes

Stephen Innes

Head of Trading APAC at OANDA
Stephen has over 25 years of experience in the financial markets and currently based in Singapore as the Head of Trading Asia Pacific with OANDA. Stephen's market views focus on the movement of G-10 and ASEAN Currencies. His views appear in Bloomberg, CNBC.Reuters, New York Times WSJ and the Economist. His media appearances include Bloomberg TV & Radio, BBC International, Sky TV, Channel News Asia, ASTRO AWANI and BFM Malaysia. Stephen has an extensive trading experience in Spot and Forward FX, Currency and Interest Rate Futures, Money Market Derivatives and Precious Metals. Before joining OANDA, he worked with organisations like Nat West, Chemical Bank, Garvin Guy Butler, and Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes