Strategist: The Weakening Trend of the US Dollar May Continue, Creating Opportunities for Emerging Market Assets

Jinse Finance reported that after Trump showed a dovish stance towards the weak US dollar, emerging market currencies and stock markets continued their rally. On Wednesday, the emerging market currency index rose by 0.3%, with the Malaysian ringgit and the Korean won leading the gains. Driven by Asian chip stocks, the emerging market stock index increased by 1.6%. Luis Costa, Head of Emerging Markets Strategy at Citigroup, stated, "We expect the trend of a weakening US dollar to continue." Emerging market currencies that are likely to benefit from this include the South African rand, Brazilian real, and Korean won. Guy Miller, Chief Strategist at Zurich Insurance, pointed out that in terms of emerging market stocks, the combination of a weak US dollar and robust global economic growth is creating a favorable environment for this asset class. Companies involved in both IT and AI spending cycles are particularly attractive.