Emerging-market currencies extended their decline for a fourth straight day on September 15, 2026, as increasing global bond yields heightened tension across riskier assets worldwide. MSCI Inc.’s benchmark for developing-nation currency returns dropped 0.3% by 11:47 a.m. in London, marking its longest losing streak since June. Concurrently, the equivalent gauge for stocks fell 0.9%. This downturn was influenced by an expected Federal Reserve interest-rate hike, its first since 2023, following hotter-than-expected core inflation in the U.S.
The selloff was exacerbated by several factors, including surging oil prices, with Brent crude nearing $110 per barrel after an attack on Saudi Arabian energy infrastructure and the closure of its East-West pipeline. Concerns about the pace of artificial-intelligence development also weighed on markets, particularly affecting South Korean equities, which slid over 3% after major AI firms called for a slowdown. The U.S. 10-year Treasury yield touched 5% for the first time since 2023, reflecting increasing borrowing costs.
The MSCI Inc. index of developing-nation currencies was down 0.2% as of 12:15 p.m. in New York, with the Chilean peso and Hungarian forint among the worst performers. While Brent crude later pared some gains and 10-year U.S. Treasury yields retreated from 5%, the overall sentiment remained cautious. Phoenix Kalen, global head of emerging-markets research at Societe Generale, noted that EMFX's sensitivity to global risk sentiment and higher oil prices would likely result in mild weakness. However, she also pointed out that investors have become more selective, distinguishing between currencies more or less vulnerable to global shocks. Traders are now awaiting central bank decisions from the Fed, Bank of England, and Bank of Japan this week for further guidance on interest rate paths amidst renewed inflation risks.
