The report analyzes EM FX trends on May 12, 2026, noting a shift to risk-off sentiment due to Middle East tensions and specific updates on RUB, ZAR, TRY, and central European currencies.
Key Takeaways
- 1.Shifted to a long USDZAR position as risk premia for the pair was insufficient given escalations in the Middle East.
- 2.The carry appeal for TRY is diluted by an increased depreciation pace (1800 pips/week), but J.P. Morgan remains long based on CBRT's priority for real TRY appreciation.
- 3.Risk-off sentiment is driving EM FX movements, with particular focus on US/Iran developments impacting the Forint (HUF) and Zloty (PLN).
Table of Contents
- USD/RUB Commentary
- USD/ZAR Analysis
- TRY Carry and Flows
- EUR/PLN Tactical View
- EUR/HUF Sell Zones
- EUR/CZK and CNB Outlook
- ILS Market Dynamics
- Carry Trade - KZT/USD
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Authors
Laoise Ni Thighearnaigh
Securities
USDRUBUSDZARUSDTRYEURPLNEURHUFEURCZKUSDILS
Themes
Geopolitical TensionsEM Carry Trade Dynamics
Regions
EuropeAfricaMiddle EastRussiaSouth AfricaTurkey