Emerging market currency arbitrage trades achieve nearly the best returns in a decade! Citigroup remains optimistic about the short-term outlook

This year, the strategy of buying emerging market currencies with US dollars has achieved the highest returns in nearly a decade, and Citigroup is optimistic about the short-term outlook. The Federal Reserve's dovish stance and the cautious attitude of emerging market central banks have supported the exchange rates of developing country currencies against the US dollar. The Bloomberg Emerging Market Arbitrage Trading Index has risen by over 10%, with the Brazilian real outperforming other currencies. Citigroup warns that greater challenges may arise in the second half of next year, as the US economy may enter a rebound phase, and a strong dollar will affect the performance of international assets