Major Wall Street banks are optimistic about emerging markets in 2022, citing dollar weakness and AI investments. Bonds in local currencies are expected to yield a 7% return, with currency gauges up over 6%. Morgan Stanley advises long positions in local-currency debt for an 8% return by mid-2026.

The Federal Reserve’s interest rate cuts will likely push the dollar lower, benefiting emerging markets. Bank of America and Goldman Sachs also anticipate a weaker dollar, with BofA expecting more than 10% returns from emerging local bonds. Volatility may increase, but the outlook remains positive.

JPMorgan Chase & Co. projects a significant impact from AI-related capital spending, forecasting US AI capex at $628 billion in 2028. This investment is expected to boost tech exports and raise metal prices in emerging markets. Overall, a bright future is predicted for emerging markets.

Read more at Yahoo Finance: Wall Street Maintains Bullish Emerging-Markets Outlook for 2026