We retain a more optimistic outlook for emerging market debt given dovish global central bank policy and real yields that have been running higher than historical averages, both of which could help mitigate exchange-rate risks in local-currency bonds. A key caveat here is that we think selective positioning is important as investors continue to worry about protectionism and deterioration in geopolitics.
Edward D. Perks, CFA, is chief investment officer at Franklin Templeton Multi-Asset Solutions.