Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

No Harm Seen in Russia-Turkey-Venezuela Debt: Chart of the Day

April 7 (Bloomberg) -- Unprecedented flows into emerging-market bonds signal renewed confidence there’s money to be made lending to the most politically volatile countries.

The CHART OF THE DAY shows a record $487 million poured into the world’s largest exchange-traded fund focused on notes from developing nations last week. Debt from Russia, Turkey, Hungary and Venezuela make up 19 percent of the $4.2 billion iShares ETF, according to data compiled by Bloomberg.

After outflows of $1.7 billion over the past year, investors are brushing aside sanctions imposed against Russia after its takeover of Crimea, accusations of graft against Turkish Prime Minister Recep Tayyip Erdogan’s administration and anti-government protests in Venezuela. Hungary Prime Minister Viktor Orban, whose centralization of power has triggered confrontations with the European Union over the past four years, won another term in yesterday’s elections, partial results show.

“Investors know Russia’s ability and willingness to pay is extremely strong,” said Michael Roche, an emerging-market strategist at Seaport Global Holdings LLC in New York. “There’s been another round of policy initiatives in Venezuela that’s bringing off near-term concern that government is facing a declining payment capacity. Within Turkey, the hold on political power by Erdogan’s party is very strong.”

Twenty-nine percent of money flowing into U.S.-based emerging-market ETFs last week went into fixed-income funds, compared with an average 10 percent in the previous five years, data compiled by Bloomberg show.

To contact the reporter on this story: Boris Korby in New York at bkorby1@bloomberg.net

To contact the editors responsible for this story: Brendan Walsh at bwalsh8@bloomberg.net David Papadopoulos

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.