Emerging Markets
The Emerging Markets (EM) are characterised by high growth dynamics. However, there are also risks to consider.
Learn more about following Emerging Markets
What distinguishes the Emerging Markets?
Emerging Markets refers to countries that are typically undergoing a transformation from a developing to developed or advanced economy. This convergence and modernisation process opens up great market potential, and Emerging Markets exhibit high growth dynamics. At Raiffeisen Capital Management, we believe that a broadly diversified fund portfolio should also include investments in the Emerging Markets over the medium to long term – if the investor is willing to bear the associated risk. Positive factors are low debt, moderate monetary policy and, as previously mentioned, the potential for strong growth, whereas the economic structures and political systems in these countries are often still in flux. Therefore, Emerging Market funds generally exhibit elevated volatility.
Current developments in the Emerging Markets
Following the price declines in April, the developed equity markets did well again in May, posting an overall gain of more than 4%, with the USA leading the way. By contrast, developments for EM equities were much more uneven, and at the index level there was only a minimal gain of around 0.3% (both figures calculated in USD).
Eastern Europe
![](https://a.storyblok.com/f/107885/1920x1080/6aba46d62f/959a62a5db99bc5dd8d88aa6aa1c7933a544a5ae.jpg/m/400x0/)
CE3 – Poland, Czechia, Hungary-Update
The new government in Poland is facing stiff headwinds, but feels reinforced by the outcome of the EU elections. The governing parties in Czechia are discussing an additional tax on banks. The new opposition party in Hungary did well in the EU elections.
![](https://a.storyblok.com/f/107885/1024x1024/f89a370524/emreport-turkei-istock-682713796.jpg/m/400x0/)
Türkiye-Update
Inflation rises to 75%, but should now fall quickly according to the central bank. In domestic politics, there appears to be some rapprochement between Erdogan and the opposition.
![](https://a.storyblok.com/f/107885/1024x1024/134ee652bd/emreport-russland-istock-174748986.jpg/m/400x0/)
Russia-Update
Russia has advanced to 4th place in the global ranking of economic output (by purchasing power parity). In the meantime, the USA has imposed new, secondary sanctions, mainly to limit Russia’s foreign trade.
Asia
![](https://a.storyblok.com/f/107885/1254x837/cfc383ccfe/emreport-china-istock-497572532.jpg/m/400x0/)
China-Update
After the USA, the EU is also taking more of a stance against Beijing. Economic performance is better than expected overall, but there’s good news and bad news. Chinese equities suffer a slight setback following gains in previous months.
![](https://a.storyblok.com/f/107885/683x512/5e6729d088/emreport-indien-istock-479801024.jpg/m/400x0/)
India-Update
PM Modi and his party win the parliamentary elections as anticipated, but unexpectedly miss out on an absolute majority of the seats. The equity market fluctuated quite sharply for a short time and has thus digested the election results.
Brazil
![](https://a.storyblok.com/f/107885/1254x836/7422277484/emreport-brasilien-istock-518230906.jpg/m/400x0/)
Brazil-Update
News in Brazil was dominated by a 100-year flood, which makes the outlook for inflation and growth more uncertain.
Despite careful research, the statements contained herein are intended as non-binding information for our customers and are based on the knowledge of the staff responsible for preparing these materials as of the time of preparation. They are subject to change by Raiffeisen KAG at any time without further notice. Raiffeisen KAG assumes no liability whatsoever in relation to this document or verbal presentations based on such, in particular with regard to the timeliness or completeness of the information presented and the sources of information, or in respect of the accuracy of the forecasts presented herein.