(Adds data, updates headline to include trade group responsible
By Dion Rabouin
NEW YORK Dec 19 Emerging market debt trading
volumes rose 21 percent in the third quarter from the same
period last year and increased 2 percent from the second
quarter, according to a survey released on Monday, as investors
continue to search globally for yield.
Debt trading volume hit $1.379 trillion in the third
quarter, according to a report released today by EMTA, the
emerging markets debt trading and investment industry trade
association. Volume was $1.137 trillion in the third quarter of
2015 and $1.357 trillion in the second quarter of 2016.
The increase from last year can be attributed to "strong
inflows (US$26 billion during the quarter), global factors (the
aftermath of Brexit) and a number of idiosyncratic
developments," Hongtao Jiang, head of emerging market credit
strategy at Deutsche Bank, said in a statement released by EMTA.
He said the largest contributors to the increase were India,
South Africa, Turkey as a result of the attempted coup, and
Argentina, which made a return to the bond market earlier this
The rise in the third quarter continued a trend of investors
seeking out debt from emerging markets as more than $10 trillion
of developed market debt traded at zero or negative yields
during the year.
Emerging market debt trading volume rose 12 percent in the
second quarter of 2016 versus the same period in 2015.
Turnover in local markets instruments rose to $878 billion
in the third quarter, accounting for 64 percent of total
reported volume. That was a 24 percent increase from a year ago
when $706 billion changed hands, and a 4 percent rise over the
second quarter of 2016.
Indian instruments were the most frequently traded overall,
according to the EMTA, with $216 billion in turnover, a 242
percent increase from $63 billion a year ago and up 15 percent
from the second quarter. Indian volumes represented 16 percent
of overall volumes.
Other frequently traded instruments were securities from
South Africa, with $112 billion traded overall, and China, with
$109 billion traded, according to the survey.
Indian instruments were also the most frequently traded
local market debt during the third quarter, or debt traded in
the local currency. India was followed by Mexico, with $152
billion, South Africa at $99 billion, Brazil at $97 billion and
Poland at $65 billion.
The figures are based on reports by 46 international banks,
asset management firms and hedge funds and tracks debt
instruments in more than 90 emerging market countries.
(Editing by Jeffrey Benkoe)