20140317-巴黎银行证券-EM_Flows_Tracker_12页_1mb

FX & IR EM STRATEGY Summary

Core Content Overview

This document provides a detailed analysis of foreign portfolio flows and foreign bond ownership in emerging markets (EM) across different regions: Asia, CEEMEA, and Latin America (LATAM), as of March 17, 2014. It also includes a review of FX reserve accumulation and highlights key factors influencing these flows.

Main Points and Key Information

Overall EM Portfolio Flows

• Bond Funds: Inflows returned to emerging market bond funds, with local currency bond funds seeing a net inflow of USD 608mn.
• Equity Funds: Emerging market equity funds continued to experience outflows, although the amount was less than in previous weeks.
• Asia: Portfolio flows remained positive, with strong bond inflows offsetting equity outflows. Inflows were particularly strong in Indonesia and Korea, while India saw solid debt inflows and Thailand experienced slight negative bond inflows.
• Korea: Recorded large equity outflows of -USD1.2bn, and India equity flows turned negative.
• Mexico: In February, it recorded its 3rd highest bond inflow since 2004, at MXN 75.9bn, with foreign ownership of local bonds reaching 42.25%.
• Colombia: In February, it attracted COP 583bn, indicating a gradual rebound from previous outflows. A potential tax cut for foreign bond investors is expected to boost participation.

Bond Flows by Region

Asia

• Korea: Foreign bond holdings declined by USD 1bn, while the stock market saw USD 0.4bn inflows.
• 2023 Bonds: Foreign holdings increased by TRY 2bn, and 2016-2018 bonds by TRY 2.2bn.
• 2014 Bonds: Holdings fell by TRY 8bn due to maturing bonds.
• India: Inflows remained solid, though the data may not perfectly reflect actual cross-border capital flows due to SEBI auctions.
• Thailand: Data covers Thai government bonds only and does not include BOT bills or corporate bonds.
• Indonesia: Covers all government bonds, but not SBI bills or corporate bonds.
• Philippines: Covers all government bonds and equity inflows, but does not provide a breakdown between asset classes.
• Foreign Bond Ownership: Data includes percentages of outstanding bonds, FX reserves, and historical comparisons.

CEEMEA

• Turkey: Foreign bond holdings declined by USD 1bn, mainly due to Treasury redemptions.
• 2023 Bonds: Increased by TRY 2bn, and 2016-2018 bonds by TRY 2.2bn.
• 2014 Bonds: Fell by TRY 8bn due to maturing bonds.
• Foreign Bond Ownership: Data includes percentages of outstanding bonds, FX reserves, and historical comparisons.

LATAM

• Mexico: In February, recorded its 3rd highest bond inflow since 2004 at MXN 75.9bn, with foreign ownership at 42.25%.
• Cetes and Udibonos: Showed strong appetite in foreign portfolio, while Mbonos increased by 2% m/m.
• Colombia: In February, recorded COP 583bn in bond inflows, with foreign participation expected to increase due to potential tax cuts.

FX Reserve Accumulation

• Asia: FX reserves showed monthly changes, with KRW, INR, THB, IDR, MYR, and PHP data included.
• CEEMEA: FX reserves in Turkey, South Africa, and Hungary showed monthly changes, with KRW and THB data using daily figures due to coverage limitations.
• LATAM: FX reserves in Brazil, Mexico, and Colombia showed monthly changes, with Mexico and Colombia highlighted for significant inflows.

Data Sources and Notes

• Data Sources: EPFR, BNP Paribas, local stock exchanges, and central banks.
• Caveats:
  • Korea: Daily data refers to net purchases, not net investment, and may overstate inflows.
  • India: Daily data may not reflect actual cross-border flows due to SEBI auctions.
  • Thailand: Data covers government bonds only, not BOT bills or corporate bonds.
  • Indonesia: Covers government bonds, not SBI bills or corporate bonds.
  • Philippines: Covers government bonds and equity inflows, but no asset class breakdown is provided.
• Appendix: Includes detailed notes on data and disclaimers about the nature of the report.

Key Charts and Data Highlights

Equity Flows

• Chart 3: Equity inflows in USDmn for different countries.
• Chart 5: EPFR weekly flows in all EM and Asia equities.
• Chart 7: EPFR weekly flows in all EM and LATAM equities.

Bond Flows

• Chart 8: Asia bond inflows in USDmn.
• Chart 10: LATAM bond inflows in USDmn.
• Chart 12: Asia foreign bond ownership snapshot.
• Chart 13: LATAM foreign bond ownership snapshot.

FX Reserves

• Chart 14: Asia FX reserves monthly change.
• Chart 16: CEEMEA FX reserves monthly change.
• Chart 18: LATAM FX reserves monthly change.

Summary of Key Trends

• Bond Inflows: Strong in Asia and LATAM, with Indonesia, Korea, and Mexico being the top performers.
• Equity Outflows: Continued in Korea and India, with moderate inflows in other parts of the region.
• Foreign Participation: Expected to increase in Colombia due to potential tax cuts.
• FX Reserves: Showed positive accumulation in most regions, with Mexico and Colombia having the highest inflows.

Conclusion

The report highlights the mixed performance of EM equity and bond markets, with bond inflows generally outperforming equity outflows. Asia and LATAM saw significant bond inflows, while CEEMEA experienced mixed results. Mexico and Colombia are notable for their high inflows and potential for increased foreign participation. The data is sourced from various public institutions and includes caveats to ensure accurate interpretation.