The Emerging Market Bond Bloodbath has left a painful trail as investors pulled a record $546 million from the largest EM Bond ETF last week. As the US Dollar surges on the intermingled themes of Trumponomics' inflation and higher rates, EM and Asian FX rates are collapsing to Lehman crisis lows as the rest of the world suffers despite US equity gains.

US Equities are the only winners…

After having bounced a little through the summer, Asian (and EM) FX has collapsed to new cycle lows relative to the US Dollar since Donald Trump's win at the election…

 

This implicit tightening of financial conditions world-wide

 

Sparked the largest exodus from EM bonds ever…

 

Coming just a fe short months after a record inflow to EM debt funds ($4.9bn)…

Leaving the largest EM Bond ETF 'stable' at a critical support level…

 

But it seems fear is back in EM land…so as a reminder, Goldman summarizes in a heat map, the EM nations with greatest potential for the upcoming Fed hike to cause a major disruption.

The darkest shaded regions indicate the largest risks.

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