Emerging markets are accelerating, powered by fresh optimism over potential US tariff exclusions and robust fiscal signals across key economies. From Hungary’s currency surge to Turkey’s rebound and Albania’s credit rating upgrade, a wave of positive developments is reframing investor sentiment and unlocking new opportunities.
Emerging market stocks have nudged upward, gaining 0.5% as investors respond positively to news that the US may exclude certain sectors from existing tariffs. Such a move could ease global supply chain pressures and improve the economic outlook, with analysts at CMC Markets suggesting the result may be a scenario that’s “less bad than feared” for international markets. Turkey, recently under strain from political tensions, is showing renewed resilience, as both the lira and local equities regain ground. Hungary’s forint, in particular, is drawing attention, having jumped nearly 8% against the dollar to become the best-performing emerging market currency. The momentum is supported by central banks in Hungary and the Czech Republic holding rates steady, reinforcing confidence in local monetary stability.
Currency gains across emerging markets are deepening as these economies benefit from the dual effect of easing geopolitical pressures and steady policy support. The forint’s rise now places it ahead of the Brazilian real, while the South African rand and Russian ruble are also trending upward. This favourable currency movement, coupled with stabilising assets in politically sensitive markets like Turkey, presents a compelling environment for investors seeking returns from a diversified global portfolio.
India is also contributing to the upbeat tone, with the Nifty 50 index and the rupee recovering recent losses, driven by solid domestic fundamentals and a more constructive global backdrop. Meanwhile, S&P Global Ratings’ recent upgrade of Albania’s credit rating reflects a broader reassessment of fiscal strength across smaller emerging economies. These interconnected developments are not only restoring confidence but may also reshape global capital allocation strategies.
Emerging markets are regaining their footing with a mix of policy stability, recovering currencies, and external tailwinds. For investors, this shifting landscape may present timely entry points in regions that are turning the corner.
Fidelity Emerging Markets Limited (LON:FEML) is an investment trust that aims to achieve long-term capital growth from an actively managed portfolio made up primarily of securities and financial instruments providing exposure to emerging markets companies, both listed and unlisted.
