MNI EM Credit Weekly

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EXECUTIVE SUMMARY:

• EM $ indices were marginally wider (+0.3bp) having set new yearly tights the week before. Tariff risks continued to dominate, with Copper and Brazilian politics the latest targets.
• LATAM $ index spreads outperformed (-3bp), with issuance somewhat subdued. Primary market activity across EM was however stronger on the week, with CEEMEA representing around 60% of new deals.
• In ASIA, Vedanta was the target of short-seller Viceroy, bonds underperformed, though investors didn’t see anything new. Copper tariffs not a driver in Asia.
• In CEEMEA,  Turkey’s President Erdogan states government running a full term, supportive for credit - Türkiye tapped investors in € the next day. Copper topical, supportive read DRC’s Ivanhoe Mines despite recent operational headwinds.
• In LATAM, the proposed 50% U.S. tariff on copper had little impact on producer Codelco and the Chile sovereign. A new 50% U.S. tariff on Brazil had a small impact on plane maker Embraer, but not much else.
• In the week ahead, earnings season starts with a focus on guidance related to tariffs. We expect spreads to be soft. In ASIA, event risk for Vedanta remains and we await news on China State support for real estate. In CEEMEA new deals from Turkish corp’s possible following sovereign € deal.