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Emerging markets is the place to invest long-term, analyst

Key Points
  • Emerging markets attractive from a structural point
  • A reentry opportunity is likely after the summer
Better EM entry opportunity after the summer: Credit Suisse

Emerging markets might be struggling with expensive borrowing but that is where to invest in the long-term, an investment advisor told CNBC on Thursday.

"We do like emerging markets from a structural point of view," Anja Hochberg, Global Head of Investment Services at Credit Suisse, told CNBC on Thursday.

Hochberg said that one probably needs to wait for a better reentry on emerging markets, but "we recommend our investors to keep emerging markets as part of their strategic asset allocations. For the longer term you need to invest there because that's where growth actually is," she said.

The improvement of the U.S. economy and the consequent interest rate hikes by the Federal Reserve mean that emerging markets could face economic problems as they are dependent on foreign money.

Stay in the market, go long on volatility: Credit Suisse

The U.S. Fed announced Wednesday its second rate hike this year and said that a third one should take place before the year-end.

According to Hochberg, this should mean a better entry opportunity after the summer.

"There's a relative outperformance of emerging markets on the equity side rather than the rest of the world. Then there will be some reversion here as well. In addition, of course you have the Federal Reserve rate hikes, people simply want to wait and see what's going to happen. Now we have it on the table people can react to it and certainly once that's digested, the way will be more open to emerging market assets in general" she said.

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