The Federal Reserve's interest rate hike is expected to cool down and emerging market currencies are rising to record highs

Market expectations for the Fed's interest rate hikes have cooled, and emerging market currencies have risen to record highs, stimulating demand for venture assets. The index for tracking emerging market currencies rose by 0.2 per cent a week, to 1906.98, and the index for emerging market equities, which touched the record high, rose by 0.6 per cent. The weakening of United States economic data weakened the market ' s expectations for further tightening of the Fed ' s policy, and the weakening of the United States dollar supported the rise in emerging market assets. Wee Khoon Chong, a senior Asia-Pacific market strategist at the Melon Bank in New York, says: “The emerging market currencies are today being supported, driven mainly by the weakening of the dollar and the continued rise in stock market risk. We have seen a re-emergence of external capital flows to emerging markets, particularly in Asia.” According to Galvin Chia, the emerging Asian strategist of the Bank of France, “the Asian currency seems to have benefited from the weakening of US data last week and the weakening of the dollar at the beginning of this week. The lack of new geopolitical information on weekends, as well as the price of Brent crude oil below $90, may also support the market, which appears to be at the end of the summer season.”