Emerging currencies may be facing calm before the storm

London

EMERGING-MARKET currencies have become a relative sea of calm amid Greece's debt crisis and China's collapsing stock prices, marking a level of complacency that strategists say is destined to end badly.

JPMorgan Chase & Co indexes show that volatility in the exchange rates of developing economies fell below price swings for the Group of Seven currencies last week by the most since 2013. It is usually the other way around in turbulent times.

Investors may be underestimating the one thing that may upend riskier assets: the will of the Federal Reserve to raise interest rates at least once before the year is out. Janet Yellen, chair of the US central bank, said last Friday that while events such as Greece added uncertainty to the economic outlook, she still expected that it would be "approp…