(Bloomberg) -- JPMorgan & Chase & Co. turned bullish on emerging-market local bonds as both global inflation and growth slow, saying they offer a more attractive risk-reward than their dollar-denominated counterparts. 

The firm is recommending an overweight position in the bonds, with debt from Malaysia, Hong Kong, Brazil, Mexico and Israel potentially outperforming, strategists Jonny Goulden and Tales Padilha wrote in a Friday note. 

“Country selection remains important as some EM local markets will likely trade weaker as global risk markets fall,” they wrote. “But overall we see asymmetric risk-reward in EM local markets.” 

The reopening of the Chinese economy is likely a new bullish driver for early 2023 that is worth paying close attention to, according to the strategists, even as uncertainty remains over its path. 

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