Tax cuts, Treasuries wreak havoc

The rout in emerging-market assets this year was spurred by higher Treasury yields and US tax cuts, alongside angst over the escalation of trade restrictions between the US and China. Still, Templeton’s willingness to sit out a directional bet on the dollar highlights how divided money managers are after the greenback has gained more than 5 per cent since mid-April.

JPMorgan Asset Management and Man Group Plc are among those expecting further strength. Others such as DoubleLine Capital’s Jeffrey Gundlach see a decline by year’s end.