EM Posts Weekly Slump as Oil Shock Triggers Rates Repricing

Emerging-market assets recorded their second week of losses and traders repriced several monetary policy moves as the Middle East crisis shows no signs of abating and concerns grow over the impact of high oil prices.

The MSCI Emerging Markets Index fell 1.5%, extending its weekly losses to 2%. Currencies, meanwhile, declined 0.5% as the greenback and oil surged on reports the Pentagon is moving a Marine expeditionary unit to the Middle East, and while Iran steps up its attacks on the Strait of Hormuz. The South African rand — often a measure of risk appetite, led losses, followed by Eastern European and Latin American currencies.