Foreign investors added $11.3 billion to emerging-market portfolios in August, extending inflows into a second consecutive month, the Institute of International Finance said. The total slowed from a revised $24.9 billion in July and was below the $35.9 billion recorded in August 2025. Emerging-market debt, which represents borrowing by developing-economy issuers, accounted for $11.2 billion of August's inflows even without new sovereign issuance, while equities attracted $0.1 billion. Sovereign issuance reached a record $191.5 billion so far this year, about $30 billion above the comparable point in 2025, with Saudi Arabia and Pakistan returning to the primary market in September. The IIF said continued demand despite elevated long-term U.S. yields suggests investors are allocating to emerging markets for their own merits rather than relying on favorable global interest-rate conditions. Year-to-date debt inflows reached $243.5 billion, compared with $212 billion over the same period last year, while equities recorded $87.5 billion in outflows versus $7.4 billion in the comparable 2025 period. Hotter-than-expected U.S. inflation data raised the CME-measured probability of a Federal Reserve rate hike next week to 87%, from below 60% a week earlier.