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Fed and ECB not the only games in town for EMs

EM bond markets have, for the most part, shrugged off the rise in developed market bond yields since the end of June. This strengthens our view that policy normalisation in developed markets is unlikely to cause systemic problems for emerging markets. Instead, monetary policy in EMs is likely to be set according to domestic rather than external conditions, meaning that in many cases interest rates are now likely to fall.

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