Carry Trade Revival That Electrified EM Spurs 2026 Optimism
Vandenhoeck is bullish on the Brazilian real, Turkish lira and South Africa’s rand, among other currencies.
Photographer: David Lombeida/BloombergBig investors say that carry trades across emerging markets have further to run in 2026 following a blockbuster year for the popular strategy.
Ebbing volatility in foreign exchange markets and a weak US dollar provided fertile ground for the trade, where investors borrow in low-yielding currencies to buy those offering a higher payout. One Bloomberg measure of the strategy has returned some 17% this year, the biggest gain since 2009.