"EM Asia bonds will get sold off based on the fact
that Yellen's thesis of allowing inflation will cause global
bonds to reprice in the future inflation premium," said Stephen
Innes, senior FX trader for FX broker OANDA in Singapore.
"With the solid growth differential offered in EM Asia, I
think the sell-off will be short-lived. Still, we need a
constructive policy direction from the Fed," Innes said.
The U.S. central bank needs to guide the market to December
lift-off and stop with theoretical concepts, which have been
confusing investors, he said.
As Thais begin a year of mourning for their king, parties
and celebrations will be toned down, particularly over the next
month, temporarily crimping consumer and tourist spending in an
economy that has been struggling for traction in recent years.
"Thailand will not only be entering a period of mourning,
but one of dynamic changes and political uncertainty," said Mark
Mobius, executive chairman of Templeton Emerging Markets Group.
"Under such circumstances, market observers will be looking
out for potential issues over political friction and royal
succession, and investors should be prepared for volatility. In
the long run however, we believe the market uncertainty will
ultimately be outweighed by Thailand's strong fundamentals," he
said.
REUTERS
