CHART: Frontier Market Currencies 'Significantly Overvalued," Says Bank Of America Merrill Lynch
![Maputo, Mozambique](https://d.ibtimes.com/en/full/102595/maputo-mozambique.jpg?w=736&f=0978c5e646ec0789336654117c786a4d)
The values of most currencies in the "frontier markets," which include Ukraine, Kazakhstan and Nigeria, are "significantly overvalued," Bank of America Merrill Lynch said on Tuesday.
"In contrast to EMFX [emerging market foreign exchange], which is largely floating and has adjusted a lot, most of the frontier FX still is pegged and thus at risk of disorderly devaluations," the bank said in a report. "Indeed, while EMFX is now around fair value and strains seem to be easing, lately shoes have started to drop in frontier: Ghana, Kazakhstan, Nigeria, Ukraine -- to name a few."
![FX chart](https://d.ibtimes.com/en/full/1557721/fx-chart.jpg?w=736&f=b012fbdc00e9f9fd3d3c170c2586a5f6)
The biggest overvaluation exists in Mozambique, Uganda, Tanzania and Rwanda, which run current account deficits of 12 percent to 40 percent of gross domestic product, the bank said.
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