The iShares Latin America 40 ETF (ILF) has gained 15% year to date, outperforming the S&P 500’s 11% rise, and more than 70% since late 2024. According to a Citi report, conditions for higher growth in Latin America are the best in decades, driven by a weak dollar, strong commodities, favorable geopolitics, and pro-reform leaders from recent elections. Real rates in the region are among the highest globally, with carry levels reaching 10% in Brazil, attracting fixed income and foreign exchange inflows. Key risks identified include a rise in U.S. interest rates and El Niño weather patterns affecting agriculture in Colombia and Peru.
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