With developed markets showing some fatigue, I'm revisiting EM equities. Valuations look more attractive, but the macro headwinds, especially from a strong dollar and persistent inflation in some regions, are concerning. What are others seeing as the key drivers for a potential rebound, or further downside risks?
I'm with you on the attractive valuations in EM. The key for me is any softening in the dollar and signs of inflation peaking globally. If those shift, EM could really take off.
While valuations are tempting, I'm still wary. Geopolitical risks are elevated, and many EM economies are more vulnerable to global shocks. I'd need to see some solid earnings growth come through before diving in.
Interesting point about developed markets fatigue. What specific regions within EM are you looking at most closely? Some seem to be handling the macro headwinds better than others.