Our forecast that emerging market (EM) GDP growth will comfortably outpace that seen in developed markets (DM) should be good news for investors. However, faster growth will be driven in large part by a pick-up in China after Covid-19 restrictions were lifted, while many other major EMs face downside risks to growth in the months ahead. That will have important implications for asset allocation.
A feature of our latest forecast is that we expect EM economic growth to significantly outpace that of developed markets this year and to remain relatively fast in 2024. We expect EM growth to be about four percentage points faster than DM growth. And, if anything, the recent wobble in the developed market banking sector, which threatens to tighten credit conditions, could lead to even more EM outperformance.
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.
