According to an analysis by the Bloomberg Economic News Network, Turkey and Mexico are the most attractive emerging markets for 2018, ahead of the Czech Republic, the UAE and Russia.
By some measures, Mexico and Turkey come out as the most attractive emerging markets for 2018.
In a Bloomberg analysis based on a range of metrics including growth, yields, current-account position and asset valuations, the two countries score highest among 20 developing economies. Asian economies occupy the five lowest-scoring positions.
Mexico and Turkey scored higher because their real effective exchange rates are more competitive than the average of the past 10 years, according to the analysis. India and China’s valuations are relatively expensive in historical terms. Their economic growth is unlikely to be as fast as it has been in the past decade, estimates show.
“If you are on the hunt for something to buy now, Turkey and Mexico stand out because they are relatively cheap,” said Takeshi Yokouchi, a senior fund manager in Tokyo at Daiwa SB Investments Ltd., which oversees the equivalent of $50 billion in assets. “When political risks ease up, that’s when you want to make an entry, given their solid fundamentals and high yield.”