Malaysia tops emerging market list

28 Nov 2018

marketsAs a result of its current-account surplus, stable economic growth outlook and valuations, Malaysia has remained at the top of the emerging-market list.

Inflation came in at 0.6% in October from a year earlier, compared with its 10-year government bond yield of about 4.17% - according to data from a Bloomberg analysis on Wednesday.

The metrics assessed upon vary from growth prospects to the state of the current account, sovereign credit ratings and stock and bond valuations.

Bloomberg reported that “Asia’s economies have stronger buffers against headwinds like Federal Reserve policy tightening and outshone the rest of the emerging markets, Malaysia holding on to the No. 1 spot.”

With that said, Turkey has plummeted, ranking fifth out of 21 nations in a similar study issued six months ago. A Bloomberg survey of economists revealed that in 2019, Turkey’s economy is expected to grow by 0.8% - marking a decrease from the estimated 3.5% this year. In October, inflation reached its highest level since 2003 at 25.2%, eroding real yields.

Of the top six economies on the scorecard, four are from Asia – including China, the Philippines and Thailand.

“A closer attention is now paid to economic growth outlooks of each emerging economy amid successive rate hikes,” said Tsutomu Soma, general manager of the investment trust and fixed-income department at SBI Securities Co. in Tokyo.

“Investors are also deciphering how each country is impacted by the U.S.-China trade frictions. They will continue to be more selective with their investments given such circumstances.”