The Shifting Dynamics in Emerging Markets Local Currency InvestingTheShiftingDynamicsinEmergingMarketsLocalCurrencyInvesting

In this paper, PGIM Fixed Income examines how dynamics in the Emerging Markets Local Currency sector have recently shifted in a more constructive direction. We find that the return profile of the asset class is more balanced between currency and term premium, thus offering investors a diverse opportunity set ranging from long-duration, high-quality bonds to shorter tenor, high-yielding assets with attractive carry and roll-down characteristics.