NYSE:MS<\/a>) is bullish on local currency debt of emerging market after getting confidence from Indonesian and Malaysian currencies. Since the start of fourth quarter 2015 (4QFY15), the Indonesian currency has appreciated 10.3%, Malaysian currency surged 5.7%, while the Indian currency weakened by 3.1%. This makes Indonesian and Malaysian securities very attractive amongst emerging markets.<\/p>\n\n\n\nDomestic sovereign bonds are expected to perform better than dollar-denominated counterparts, according to Morgan Stanley investment management. Oil prices are expected to bottom out soon due to which the demand for high yielding assets will be increased.<\/p>\n\n\n\n
The most attractive interest rates are offered by Indonesian and Indian notes amongst Asia\u2019s biggest economies. This is because their central banks have room to cut interest rates.Morgan Stanley awaits the right time to overweight on such securities. It\u2019s a fact that valuation of developing countries\u2019 debt is too cheap; due to slow growth in these countries, the valuation is likely to be on a weaker side for a significant time. Chinese authorities have shown some signs of stability by sustaining yuan and attracting investors. The Chinese economy is still in turbulence and is not expected to recover anytime soon.<\/p>\n\n\n\n
The government in India and Indonesia are head-on-head to meet the macro challenges their economies are facing; Morgan Stanley analysts expect that these measures will help these economies to meet future challenges. They will also benefit from their diversified exports due to which slow demand from China will have minimal impact on them.<\/p>\n\n\n\n