Quarterly Update for the second quarter of 2026: Latin American Local Currency Debt

In this video, Alexandre Larraín, Portfolio Manager FX & Rates, reviews the performance of Latin American local currency debt during the second quarter of 2026, a period marked by a weaker U.S. dollar, falling inflation expectations and a broad rally across regional fixed-income markets.

Throughout the capsule, he discusses the key factors behind the asset class’s strong performance, including currency appreciation, carry returns and declining local bond yields. He also analyzes Latin America's outperformance relative to broader emerging markets, examines the sharp rally in Colombia and the contrasting developments in Brazil, and explains how changing valuations and dispersion across countries are shaping investment opportunities in the region.