Get out of the G7 bond market excluding Canada ahead of next Tuesday's Federal Reserve meeting, Marc Ostwald, a strategist at Monument Securities, said.
"The big risk for Tuesday's Fed meeting is that the market will look at any change in language or QE (quantitative easing) policy and ask what has really changed, we could see a classic case of buy on the rumor and sell on the facts," Otswald said.
"Yields are low as people bet on deflation that there is very little reason to be in US, German or Japanese debt" he added.
The deflation brigade are "barking up the wrong tree" according to Ostwald, who says investors should be focused on South East Asia and Latin America, excluding Indonesia and Venezuela.
"I look at the dollar, yen and euro and think I would rather be anywhere else," he said.
"Currency markets need to absorb big changes with a number of currencies in the emerging world needing to revalue higher. The big question is whether this trend can happen in an orderly fashion or, in other words, without dollar panic," Ostwald added.
Weak Dollar Policy
Investors are walking a tight rope as the developed world attempts to get itself out of the debt crisis, according to Kit Juckes, the global head of foreign exchange strategy at Societe Generale.
"The western world and Japan are attempting to drive a weak currency policy that will put pressure on emerging nations and drive currencies from commodity producers and major emerging markets higher," Juckes told CNBC.
"The dollar is heading lower but Japan and Europe are attempting the same thing and might just succeed. Either emerging nations allow their currencies to appreciate or they buy more debt or assets from the US, Japan and Europe," he added.
A slowdown may be on the cards, Juckes said, pointing out to a weakening of Chinese PMI, a weak US housing market and UK services data that are making him "nervous" because they may indicate government job losses later in the year.
"The Fed is terrified of a lost decade and is working so hard to tackle the threat of deflation it will not happen," Juckes said. "A more dovish stance from the Fed is likely, so we expect more dollar weakness."
"In this environment I say buy gold, the Australian dollar, big cap equities, oil and coal," he added.