Analysts predict the MSCI Emerging Markets Index of shares will gain around 15% over the next 12 months, versus about 10% for its developed peer. Flows into emerging-market equities are also growing faster than their counterparts, based on some of the world’s largest exchange-traded funds.
Fund managers say returns on emerging-market assets are set to power head of their developed peers, having moved in lockstep since US President Donald Trump unleashed his tariff blitz in April.
The prospect of more Federal Reserve policy easing, a pivot away from US investments, and more conservative fiscal policies in emerging nations are likely to drive that outperformance, according to Fidelity International, T. Rowe Price and Ninety One Plc. Favourable inflation also suggests emerging markets will prosper, they said.
