FX: Short-Term Upside Potential Vs Yen

With the US Fed's US$800bn capital injection offering a reprieve for global markets this week, we believe that there could be room for the Brazilian real and Mexican peso to regain some lost ground against the majors, at least in the short term. On a cautious note, BMI does not believe that we are at a decisive turn in the road for EM assets just yet. However, a prolonged bear market rally this time around could bode well for the EM high yielders.

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