Global EM Strategist: Finding Your Funder

Research evidence excerpt

Global EM Strategist: Finding Your Funder

Global Idea

June 8, 2026 07:18 PM GMT

Morgan Stanley & Co. International plc+MGlobal EM Strategist James K Lord

Strategist

Finding Your Funder James.Lord@morganstanley.comMorgan Stanley & Co. LLC +44 20 7677-3254

Simon Waever

A divergence in growth trajectories favouring the US, shaky risk StrategistSimon.Waever@morganstanley.com +1 212 296-8101

appetite amid continued high energy prices is a USD bullish Ioana Zamfir

alignment and a headwind for EM. We continue to expect Strategist

Ioana.Zamfir@morganstanley.com +1 212 761-4012

appetite for EM local currency exposure but diversifying funding Emma C Cerda

can help de-risk and isolate the EM view. StrategistEmma.Cerda@morganstanley.com +1 212 761-2344

Sofia Palacios

Key Takeaways StrategistSofia.Palacios@morganstanley.com +1 212 761-0428

We remain constructive on EM currencies, but the rebounding USD has Morgan Stanley & Co. International plc+

challenged the near-term outlook. Neville Z Mandimika

Even if the USD rebound persists, EM should still perform vs G3. Fundamentals Neville.Mandimika@morganstanley.com +44 20 7425-2509

and policy credibility anchor the asset class vs DM. Arnav Gupta

We explore the return profiles of long EM exposure with different funding Arnav.Gupta@morganstanley.com +44 20 7677-0382

currencies. CAD has been an effective choice by raising returns while lowering Morgan Stanley Asia Limited+

vol. Gek Teng Khoo

Across multiple time frames though, using a basket of funding currencies is Gek.Teng.Khoo@morganstanley.com +852 3963-0303

generally an improvement across various metrics vs any single DM funding Morgan Stanley India Company Private Limited+

currency. Nimish M Prabhune

Nimish.Prabhune@morganstanley.com +91 22 6996-1862