Bank of America Corp., citing EPFR data, reported US$1.7bn flowing into developing-market debt funds in the week ended August 6, marking four months of consecutive gains.
An index of local bonds has risen more than 12 percent in 2024, while 18 of 23 major emerging market currencies have advanced against the dollar.
The gap between volatility gauges for emerging currencies and Group-of-10 peers remains near a 12-year high, signalling calmer conditions for the developing world.
Gorky Urquieta, co-head of emerging market debt at Neuberger Berman, said the likelihood of a major dollar rebound is limited, with global growth holding steady.
He favours carry trades in South Africa, Turkey, Brazil, Colombia, Indonesia and South Korea.
