Carry Trade Comes Surging Back With Biggest Gains Since 2016
- Rising rates, low volatility has increased payout on strategy
- Best gains in commodity-linked currencies in developed world
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The returns on carry trades are roaring back in the currency markets of the world’s major developed countries, thanks to surging commodity prices, low volatility and the growing ranks of central banks moving to tighten monetary policy.
The combination has allowed traders to reap the biggest profits in five years from such trades, which involve borrowing in nations where interest rates are still low and investing in those where yields are higher.