Emerging markets trading hits record $1.75 trillion in Q2

By Aaron Hochman-Zimmerman

New York, Aug. 23 - Emerging market debt trading hit a record volume during the second quarter, according to trade association EMTA.

Trading totaled $1.754 trillion compared to $1.658 trillion during the second quarter of 2006, according to a press release.

Local deals made the majority of the volume, accounting for 64% of the money changing hands.

The highest volume traders were Mexico, Brazil and Argentina with $373 billion, $302 billion and $146 billion traded respectively.

"During the first quarter of 2007, risk appetite for emerging markets continued to rise, thus markedly increasing capital inflows to these economies," Paulo Leme, managing director for emerging markets economic research at Goldman, Sachs & Co., said in a press release.

"Together with encouraging prospects for the global economic environment and consequently emerging markets, these factors sustained new inflows to emerging markets and the trading in EM securities in the second quarter," Leme added.

Leme forecasts that emerging markets will survive the current credit crisis.

The summer's downturn will "not materially dent growth prospects for the world economy and emerging markets," he said in the release.

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