20140609-巴黎银行证券-EM_Flows_Tracker_12页_1mb

FX & IR EM STRATEGY Summary

Core Content

This report provides an overview of foreign investment flows and FX reserve changes in Emerging Markets (EM), focusing on Asia, CEEMEA, and Latin America (Latam). It highlights the trends in equity and bond inflows, as well as the impact of these flows on local currencies and financial markets.

Main Points

Asia

• Equity and Bond Inflows: Asia continues to benefit from moderate equity and bond inflows.
• Korea and India: These countries saw the strongest combined portfolio inflows, with bonds dominating.
• Thailand: Experiencing a positive turnaround, with equity and bonds seeing their first week of inflows after four weeks of outflows.
• Indonesia: Foreigners sold government bonds in June, following record foreign ownership of 35.7% of IDR-denominated securities in May.
• FX Reserves: Korea reported a sharp increase in FX reserves (circa USD 7.2bn) in May, suggesting the Bank of Korea (BOK) was active in slowing won appreciation. Thailand was the only country in Asia reporting a slight decline in FX reserves in May.
• Foreign Bond Ownership: Foreign ownership of bonds in Asia varied, with notable levels in Korea (24.9%), India (11.4%), Thailand (13.3%), and Indonesia (35.7%).

CEEMEA

• Turkey: Foreign bond holdings increased by USD 1.9bn, driven by USD 0.6bn in repos. Inflows were concentrated in 2015 and 2016. The Central Bank of the Republic of Turkey (CBRT)’s gross and net reserves remained unchanged at USD 130.6bn and USD 40.6bn respectively.
• South Africa: Non-resident flows into South African local debt were sizable, with USD 673mn in the first week of June and over USD 1.2bn in May.
• Hungary: Foreign bond holdings reached USD 22.0bn, with a high percentage of foreign ownership relative to FX reserves (46.6%).
• FX Reserves: The report tracks FX reserve changes in CEEMEA, with Turkey and South Africa being key regions.

Latin America (Latam)

• Bond Inflows: Latam experienced the 10th consecutive week of bond fund inflows, totaling USD 3.8bn, with USD 755mn in the first week of June.
• Equity Outflows: Equity funds saw minimal outflows (USD 37mn) but had accumulated USD 3.1bn since the end of March.
• Brazil: The main destination for equities funds flows, with USD 151mn in the last week and USD 2.1bn since April.
• Mexico: The main destination for bonds funds flows, with USD 209mn in the last week and USD 1.4bn since April.
• Colombia: Non-residents now hold 9.4% of local debt, indicating a positive month of inflows.

Key Information

• Bond Flows:

  • Asia: Inflows were strong in Korea and India, with Thailand showing a turnaround. Indonesia saw outflows in June.
  • CEEMEA: Turkey had significant bond inflows, while South Africa and Hungary also showed notable foreign bond ownership.
  • Latam: Brazil and Mexico were the main recipients of equities and bonds flows, respectively. Colombia reported continued inflows.

• Equity Flows:

  • Inflows were observed in various EM regions, with Brazil leading in equities fund inflows.
  • Equity outflows were minimal in Latam, with only USD 37mn reported in the last week.

• FX Reserves:

  • Asia: Korea's FX reserves increased significantly, while Thailand saw a decline.
  • CEEMEA: Turkey and South Africa had notable FX reserve changes.
  • Latam: The report includes monthly FX reserve changes, highlighting the trend of inflows.

• Data Sources:

  • The report uses data from various sources including BNP Paribas, Bloomberg, local stock exchanges, and central banks.
  • Notes caution about the limitations of daily data, which may not accurately reflect actual capital flows due to factors like auctions and redemption practices.

• Region-specific Analysis:

  • Each region (Asia, CEEMEA, Latam) is analyzed for its bond and equity flows, with charts and tables providing detailed insights.

Summary of Charts

• Chart 1: All EM equity vs EM bonds flows.
• Chart 2: Weekly EM bond flows by currency type vs JPM USD EM bond ETF.
• Chart 3: Equity inflows: latest snapshot (USDmn).
• Chart 5: EPFR weekly flows in all EM and Asia equities.
• Chart 7: EPFR weekly flows in all EM and Latam equities.
• Chart 8: Asia bond inflows: recent trends (USDmn).
• Chart 10: CEEMEA bond inflows: recent trends (USDmn).
• Chart 12: Latam bond inflows: recent trends (USDmn).
• Chart 14: Asia FX reserves – monthly change.
• Chart 16: CEEMEA FX reserves – monthly change.
• Chart 18: Latam FX reserves – monthly change.
• Chart 20-28: Region-specific data for India, Korea, Thailand, Philippines, and Indonesia.
• Chart 38-43: Region-specific data for Turkey and Hungary.
• Chart 44-48: Region-specific data for Brazil, Mexico, and Colombia.

Disclaimer

• This document is a marketing communication and not independent investment research.
• It is subject to conflicts of interest and may be influenced by interactions with sales and trading.
• No liability is accepted for any loss arising from reliance on the information.
• The report is for professional clients only and may not be passed on to retail clients.
• It is non-independent and has been approved for publication in the UK, France, and other jurisdictions.