At Any Rate EM Fixed Income: A year of Latam elections
Nov 13, 2025
Gisela Brant, a LatAm rates strategist, and Ben Ramsey, Head of EM Sovereign Credit Strategy, dive into the impact of upcoming elections on the region's fixed income markets. Gisela discusses the current vulnerability of local rates, emphasizing improved macro fundamentals and attractive valuations. She also evaluates specific risks in Chile, Peru, and Colombia. Meanwhile, Ben highlights how the outcomes of Ecuador's referendum and elections in Colombia and Brazil could shape sovereign credit spreads and fiscal credibility.
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Elections Less Disruptive Than 2021–22
- Latin America remains politically polarized but the social and institutional context is less extreme than 2021–22.
- Tanya Christovova expects election-driven FX moves to be much smaller than the ~20% average seen previously.
Dollar Cycle Will Amplify Election Effects
- The dollar cycle will amplify or contain electoral FX moves next year.
- Tania expects continued reallocation out of concentrated dollar positions to support EM if the dollar weakens or stabilizes.
Rates More Resilient This Cycle
- LatAm rates are less vulnerable this cycle due to stronger macro fundamentals, better valuations and neutral positioning.
- Gisela Brant notes real rates are positive, inflation moderated and current accounts improved versus 2021–22.