COVER STORY

Short End of the Stickย 

High local yields made Latin America a haven this year. But its borrowing costs are decided at the long end of the US curve, where deficits and heavy supply are holding rates up โ€” with or without the Fed.

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Private Credit: Credit Where It’s Due

While private credit wobbles in the US, Latin Americaโ€™s version is still small, lends to borrowers with little debt, and works alongside the banks. The test is whether it stays that way as money pours in.

Infrastructure Finance: Borrow Now, Fix Later

As the carry trade unwinds and rates stay high, infrastructure sponsors across Latin America are turning to short-term loans. They are betting that cheaper money will come before the bill does.

SPECIAL REPORT: MANAGING THE SOVEREIGN BALANCE SHEET

Sovereign Debt: Spreading the Risk

With dollars costly and US debt swelling, Latin America is borrowing elsewhere: Europe, Japan, and, increasingly, at home. Spreads have narrowed as Washington looks riskier. The test is whether fiscal discipline holds.

Local Currency: Home Truths

Latin American sovereigns are borrowing more in their own currencies, at home and abroad, and investors turning away from a weaker dollar are eager to buy. But local debt brings costs and risks of its own.

Sustainable Finance: Label Optional

Thematic bond issuance in Latin America more than halved last year. Debt managers say the label must now earn its keep, while investors keep funding green projects with or without one.

Reserves Management: The Price of Safety

Latin America’s central banks have built more than $900 billion in reserves to guard against the next crisis. Keeping that money safe and liquid means giving up returns, so reserve managers are looking beyond the dollar, reaching carefully for yield and bringing in outside expertise, without forgetting what the money is for.

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PARTING SHOT