EM currency turmoil reflected in hedge fund performance and flows

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Emerging market inflows may start to reverse as performance slows

Turmoil in emerging market currency markets is reflected in hedge fund performance figures. The latest data from eVestment shows a mixed reaction to the tightening of monetary policy by the US Federal Reserve, widely seen as the catalyst for recent foreign currency volatility that is almost a complete reversal of the effect of a few years ago when the Fed and others embarked on quantitative easing.

Flows into emerging market funds were at their most negative in July compared with a year before.