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Bank of America (BofA) expects increased foreign fund flows into emerging markets in 2026, with Türkiye reportedly positioned as one of the primary beneficiaries of this capital shift, according to a new report from the financial institution.
The bank anticipates global funds will pivot away from U.S. assets toward emerging markets, a trend supported by growing signs of resilience in developing economies.
David Hauner, Bank of America's Head of Global Emerging Markets Fixed Income Strategy, identified multiple factors supporting emerging market assets.
"A weakening dollar, room opening up for central banks to cut interest rates, and funds' historically low-level positioning will support emerging market assets," Hauner said.
The report identified Brazil, Mexico, Colombia, Türkiye and Poland as the countries expected to benefit most from foreign fund inflows.
Bank of America's analysis suggests these nations are particularly well-positioned to attract international capital as investors seek opportunities outside traditional developed markets.
The report noted that Asian local currency bonds may attract more limited investor interest due to low interest rates in the region.
This disparity highlights the varying appeal of different emerging market regions as global investors reassess their portfolio allocations for 2026.
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