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Emerging market bonds - brace for lower yields in 2018

But there are still pockets of opportunities where bond investors can seek value. By Neel Gopalakrishnan

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Shanghai's Pudong financial district. China accounted for around 65% of primary bond issuance in Asia, giving quality issues outside China a rarity value and a stronger secondary- market bid.

EMERGING market (EM) bonds have had a solid run for several years now (see chart below). The JP Morgan Asia Credit Index (JACI, a widely used index of Asian USD-denominated bonds) has returned a CAGR of around 7 per cent between January 2009 and December 2017.

However, investors will find...

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