What's Driving the Emerging Markets Rally?

The video discusses the unexpected positive reaction of emerging markets to a surge in US CPI, which typically would have led to volatility and declines. Two main explanations are provided: the rise in commodity prices, such as oil and copper, and the perception of 'good inflation' linked to stronger US economic growth. Additionally, the video explores the impact of Trump's policies on emerging market credit, noting that fears of protectionism have not materialized, and credit spreads have reached multi-year lows. The tension between different narratives about Trump's policies and their effects on emerging markets is also highlighted.

What unusual reaction was observed in emerging markets recently?

How did the expectation of a hawkish Fed and a stronger U.S. dollar typically affect emerging markets?

What are the two explanations given for the rally in EM stocks and currencies?

What patterns were observed in emerging market credit following the Trump win?

What are the two differing narratives regarding Trump's impact on emerging markets?