JP Morgan to add Philippines and Saudi Arabia to EM bond index

Saudi Arabia and Philippines Join JP Morgan GBI-EM Index

JP Morgan will add Saudi Arabia and the Philippines to its local-currency emerging market debt index starting January 29, 2027. The phased inclusion process will span 10 months, bringing both nations into the bank’s widely tracked GBI-EM index series, Marketscreener reported.

The transition will integrate $50 billion in Philippine government bonds and $79 billion in Saudi sovereign sukuk instruments. Once the process concludes, Saudi Arabia is expected to hold a 2.71% weight in the index, while the Philippines will hold 1.64%.

Adjustments to Emerging Market Country Caps

The expansion of the index coincides with a broader structural change to how JP Morgan manages country exposure. The “Country Cap,” which dictates the maximum weight a single nation can represent in the “diversified” index, will drop from 10% to 9%.

This reduction will trigger weight decreases for several major markets currently held in the index. China, India, Mexico, Malaysia, and Indonesia will see their respective shares reduced to comply with the new 9% limit.

Bond Inclusion Details

The index update incorporates a total of nine Philippine bonds and eight Saudi sukuk instruments. While the final weights are slightly different from the initial figures sketched out in April—with Saudi Arabia’s allocation trending higher and the Philippines’ trending lower—the adjustment is a major change for the index series.

Saudi and Philippine Debt Joins Index in January 2027

When does the index adjustment begin?
The phased inclusion of Saudi and Philippine debt begins on January 29, 2027.

Which countries will face reduced weights?
China, India, Mexico, Malaysia, and Indonesia will have their weights reduced to meet the new 9% country cap.

How much debt is being added to the index?
The update includes $50 billion in Philippine bonds and $79 billion in Saudi sukuk instruments.