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A bull statue at the Korea Exchange (KRX) in Seoul, South Korea, on Wednesday, Nov. 5, 2025. South Koreas equity benchmark staged a sharp rebound in the afternoon as retail investors saw the selloff as an opportunity to add exposure to one of this years top-performing global markets. Photographer: SeongJoon Cho/Bloomberg
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Moneycontrol•06-01-2026, 00:55

EM Currencies Surge as Dollar Loses Haven Appeal Amid Geopolitical Tensions

  • •Emerging market currencies rebounded, nearly erasing earlier drops, as the USD weakened despite increased geopolitical risks from the US capture of Nicolas Maduro.
  • •The dollar lost its safe-haven appeal after US manufacturing activity shrank significantly, wiping out gains from Maduro's ouster.
  • •Colombia, Mexico, and Brazil's currencies climbed, while Venezuela bonds rallied, delivering profits to investors.
  • •Developing nations like Mexico, Chile, and Saudi Arabia are actively selling bonds in global capital markets.
  • •MSCI Emerging Markets Index rose 1.6%, driven by tech giants like Taiwan Semiconductor Manufacturing Co. due to AI optimism and Chinese stimulus hopes.

Why It Matters: EM currencies gain momentum as USD weakens; tech drives market rally despite geopolitical and economic uncertainties.

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