EM Stocks, Currencies and Gold Surge as US Dollar Weakens

Emerging-market assets, including stocks, currencies, and gold, are rallying as tensions between the US and Europe weaken the dollar. The MSCI Emerging Markets Equity Index gained for a second consecutive day on Friday, extending its streak to five weeks of gains, marking its longest winning run since May. Asian tech shares have driven the rally, while Latin American equities have surged 13% in 2026. Investors are diversifying away from US assets, with emerging-market funds attracting record inflows. The iShares Core MSCI Emerging Markets ETF saw over $6.5 billion in January, the largest monthly inflow since its launch in 2012. Meanwhile, currencies like the Brazilian real and Colombian peso have risen more than 3% this year, and Poland’s National Bank approved plans to buy an additional 150 tons of gold. Deutsche Bank strategist Oliver Harvey noted that EM assets benefit from global growth and constrained opportunities in developed markets. However, geopolitical risks could temper flows into emerging markets, which collectively value around $36 trillion—half the size of the US market at $73 trillion.