The Brazil selloff that pushed the real to a 12-year low and sent bond yields to a record high is starting to lure money managers wagering that things can’t get much worse.
Investors who can stomach the volatility can pick up dollar-denominated notes that yield over two percentage points more than similarly rated Philippines bonds, while 10-year government securities in reais pay holders about 14 percent, a rate that trails only Nigeria among major emerging markets.
Optimists are betting that Latin America’s largest economy has plenty of long-term potential even amid a rout driven by the worst recession since 1990, talk of impeaching the president, soaring inflation and stifling interest rates. Things are bad right now, they acknowledge, but they’ll turn around.
Brazil Energy Insight 
Leave a comment