KUALA LUMPUR: Templeton Emerging Markets Group sees long-term investment opportunities in emerging markets considering the weakening regional currencies and is looking at investing more money in Malaysia.
Chief investment officer Stephen Dover said the investment firm liked Malaysia’s experience in dealing with economic crisis, exposure towards dealing with international investors and resilience in managing its economy.
He was speaking at an exclusive roundtable discussion on Emerging Markets Outlook 2017 held in Kuala Lumpur on Monday.
Dover said the weakening ringgit had presented the investment company a good opportunity to venture into Malaysia’s equities market.
He said the Malaysian market was not very well understood by foreign investors as it had always been thought of as a commodity and big export economy, and this had caused a negative knee-jerk reaction when the United States indicated a protectionism approach towards its economy.
Dover, who is also chief investment officer of Franklin Local Asset Management, said big and sophisticated institutional investors had also shown increasing interest in Asean countries due to the region’s strong long-term prospects.
While interest rate hike in the US is inevitable, he said the three hikes hinted by the Federal Reserve for 2017 were not likely to happen unless there was an anticipated peak in inflation or further growth in the US economy.
“The Federal Open Market Committee had over-anticipated rates hike in the past and this (three times hike for 2017) would very likely be in the high-end.
“There is so much fear in rising interest rates, and so much certainty that the US dollar will rise if interest rates go up that people ‘pre-hurt’ the emerging market currencies, which are priced as if there is a crisis in the market while there is none,” he added. - Bernama
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