- Emerging market (EM) currencies have weakened significantly over the past decade and are now generally undervalued according to Capital Group’s in-house fundamental-based FX valuation model.
- That said, a broad-based rally in EM FX is unlikely given the current global growth outlook and a decelerating EM credit cycle.
- Low structural growth including rising debt burdens and low productivity are also a secular EM FX headwind.
- Capital Group sees value in select EM currencies including the Mexican peso and the Russian ruble. READ MORE
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