MNI EM Credit Weekly

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EXECUTIVE SUMMARY:

• Tariff volatility subsided as potential deals inched forward, and earnings season kicked off. Issuance stayed low ($10bn), creating a stable backdrop in which EM $ index spreads were marginally tighter (-0.2bp).
• In our coverage, LATAM underperformed ($ Index +6.5bp), yet all regions are close to YTD tights. In ASIA, the outlier was Korea (+7bp). In CEEMEA, risk appetite supported another firm week for spreads.
• In ASIA, tariff talks continued to dominate, with Indonesia agreeing a 19% rate with the U.S. (vs threatened level of 32%). Vanke guided H1 losses higher YoY and Adani Ports finally launched its $ buybacks.
• In CEEMEA, earnings season focused on Qatar’s fins, where secondary spreads already reflect early confirmations of solid credit metrics. In addition, Senegal sovereign bonds recovered from the recent cash price lows.
• In LATAM, Argentinian President Milei’s budget restraint agenda was threatened by higher spending legislation, while pressure on Pemex mounted as suppliers both foreign and domestic demanded payment.
• In the week ahead, earnings season unlikely a spread driver and blackout period will curb supply— usually a technical tailwind—but likely harsher U.S. rhetoric around tariffs and possible push back of existing deals may see wider spreads.