From Precy Dumlao, Opalesque Asia:
Emerging markets currencies are likely to rally as uncertainties developed countries continue to worry investors, said Giancarlo Perasso, chief economist for the Matrix Redux Emerging Markets Fund, which is managed by the Matrix Group, a UK-based asset manager with $5.56bn in AuM.
Matrix also released some of the highlights of its study:
- No double dip for the US economy, thanks to strong policy reaction to the cooling down of growth. Fiscal policy will not be the main instrument of this new stimulus...rather the Fed is ready to ease again
- The Eurozone will face a difficult Fall, as tensions in some countries (Greece, Italy) are likely to spook investors
- Emerging markets will continue growing, albeit at a slower pace
- Commodities prices will not decline but will not rally either (aside from short-lived speculative bursts), as growth remains subdued
- EM currencies are bound to rally and top picks are the Turkish Lira, the South African Rand, the Brazilian Real and, for the more adventurous, the Colombian Peso, the Peruvian Sol
U.S. economy to slow down but not enter double dip
According to Perasso, the U.S. economy may slowdown but if necessary, the Fed will take swift action to ensure the country will not enter into a double dip recession. He added the U.S. government's current priority is to prevent such a double di......................
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