Pictet sees long term opportunities in EM debt

Simon Lue-Fong, manager of Pictet's Emerging Local Currency Debt fund, has reduced his long duration bias in preparation for the end of emerging market bank's rate cutting cycle.

Lue-Fong says despite the market remaining susceptible to weak economic data, IMF support is continuing to boost asset prices. "Emerging market debt held up well relative to other asset classes in 2008 and in 2009 has performed strongly as global financial markets have rallied. Other asset classes may find it difficult to maintain these levels in the near-term," Lue-Fong says. "Sentiment continues to improve and there have been positive surprises in terms of domestic demand and export data in some emerging countries." Leu-Fong says the portfolio now has a long bias to emerging ma...