Carry Trade Strategy Surges 18% Year-to-Date, Largest Annual Gain Since 2005

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According to Bloomberg data, a carry trade strategy of borrowing euros to purchase a basket of emerging market currencies—Brazilian reals, Colombian pesos, and Turkish liras—has surged 18% year-to-date as of last week, marking the largest annual gain since 2005. The strategy is being actively promoted by strategists at Citigroup and other major banks.
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