Currencies
BofA Touts Hedges as Emerging Markets Shrug Off Middle East Risks
Members of the Israeli special forces use a loader to remove the apparent remains of an Iranian ballistic missile in Tel Aviv on June 19.
Photographer: Michael Giladi/AFP/Getty ImagesCurrency bets across Europe, Middle East and Africa offer the best hedges against a rebound in the US dollar as investors grow complacent about risks from escalating geopolitical tensions, Bank of America Corp. says.
“We are concerned that markets underestimate the risks from the Iran situation,” David Hauner, head of global emerging markets fixed-income strategy, wrote in a note. “If energy prices spike materially, the crowded USD short position is likely to be vulnerable, and with it positioning across EM.”