At Any Rate EM Fixed Income: Will EM markets keep trading Iran conflict de-escalation?
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Apr 9, 2026 Ben Ramsey, Head of EM Sovereign Credit Strategy at J.P. Morgan, and Anezka Christovova, Head of EM and Latam Local Market Strategy at J.P. Morgan, discuss EM fixed income responses to a two-week ceasefire. They debate conflict trajectory and market reactions. Topics include EM FX resilience, oil-driven inflation risks, sovereign spreads and carry, and country-level winners and value opportunities.
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Ceasefire Cuts Tail Risk And Sparked Relief Rally
- The announced two-week U.S.-Israel ceasefire materially reduces tail-risk and supports a relief rally across EM assets.
- Jonny Goulden highlights big moves: EM FX up ~2-3%, sovereign credit -22bps, and EOM local rates -17bps after the announcement.
Incentives Point Toward De escalation But Uranium Is Key
- Both sides have incentives to de-escalate, making a genuine reduction in tail risks more likely.
- Anezka Christovova flags enriched uranium negotiations as a key determinant of how deep and durable any deal will be.
EM Currencies More Resilient Than Expected
- EMFX showed resilience with several currencies back to or stronger than end-February levels despite initial heavy selling.
- Anezka notes low carry imbalances, decent real yields and light structural positioning underpinning the rebound.