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Back-to-School Analysis

Markets were hit this Monday by a fresh escalation of hostilities between the United States and Iran, featuring U.S. strikes against IRGC targets on Larak Island in the Strait of Hormuz, and Iranian retaliatory measures against the United Arab Emirates and Jordan. Markets also had to digest the hawkish speech delivered by Fed Chair Kevin Warsh at Jackson Hole, where he reaffirmed the 2% inflation target and noted that “there is work left to do.” As an immediate result, the probability of a Fed rate hike in September quickly jumped from 36% to 67%.

U.S. Bonds: Normalization, Not Fiscal Alarm

The U.S. Treasury yield touched annual highs, approaching 4.8%, while Japanese sovereign debt (with JGBs near 3%) and German debt (Bunds at 3.3%) were also affected.

News regarding U.S. debt reaching $40 trillion helped amplify the noise, though the numbers point in the opposite direction: the historical correlation between the debt-to-GDP ratio and real rates (TIPS) is negative, because until 2017 the government only increased spending substantially during recessions. The fiscal outlook projected by the Congressional Budget Office (CBO) analysis is not optimistic, but for now, nominal economic growth (according to the New York Fed’s model) far exceeds the 10-year bond yield—suggesting that borrowing costs are not onerous for investment—and, surprisingly, Trump has not fulfilled forecasts, as the budget deficit has remained fairly stable since 2024 despite everything.

For all these reasons, although the uncertainty introduced into the macro picture by the closure of Hormuz, the war in Ukraine, Trump’s fiscal policy, or the Fed’s abandonment of forward guidance has impacted bonds, the rise in yields has less to do with the fiscal picture than with the normalization of growth, inflation, and rate trends.

We are coming off a very peculiar 2010–2020 decade, marked by disinflationary dynamics, household and corporate balance sheet deleveraging, and below-potential growth that led major central banks to adopt zero interest rate policies.

Over the past two years, we have witnessed a macro normalization, with inflation rates slightly above the comfort zone and more robust GDP growth. As a result, 10-year real interest rates in the United States have returned to the range where they fluctuated in the mid-2000s, still well below the levels reached in the 1990s, and the term premium has also regularized.

Despite the noise, bond yields have followed the historical pattern of behavior maintained over the last 30 years relative to interest rate expectations (approximated via SOFR futures). This serves to prove that the yield spike has more to do with a new economic reality than with a higher perceived threat of default associated with U.S. debt.

Similarly, if we model the U.S. bond yield using the latest update of the Fed’s economic projections report, we can conclude that the asset is trading at a certain discount, attributable to the uncertainty affecting energy prices.

However, households and businesses are less sensitive to rate hikes than in the previous decade. Their balance sheets have been repaired since then: household debt as a percentage of GDP hovered around 100% between 2008 and 2009 and today stands at 64.85%, levels not seen since 1997. Furthermore, their leverage ratio relative to net worth is at 60-year lows. In the corporate sector, according to the NFIB survey, management teams show no significant concern over interest payments on their debt.

On the Fed, Inflation, and the Labor Market

Additionally, labor market activity and inflation may ease Warsh’s task in the coming months. Bloomberg’s inflation and job creation surprise indices point to a moderation in the Fed’s hawkish stance, a conclusion similar to that drawn from the Truflation index, which incorporates the prices of millions of daily transactions. The August price index data, set to be published on September 11, will have major implications.

An advance indicator came on Thursday with comments from Christopher Waller, who validated signs of easing inflationary pressures while remaining watchful for evidence confirming a trend toward the 2% target. Following his intervention, futures shifted to price in only a 52% probability of a September rate hike. If the monthly core figure comes in at +0.2% as estimated by consensus economists, the Fed will likely maintain a hawkish tone without altering benchmark rates.

In the labor market, we continue operating in a “few layoffs, few hires” environment, although we may be losing some momentum in recent months. The private ADP job creation indicator has maintained a downward trajectory since March, while the Kansas City Fed labor market conditions indicator has yet to find a floor.

Equities: Resilience and Valuation

All told, investors may be overestimating the impact that a 5% yield could have on stock market performance.

The deleveraging process carried out between 2010 and 2020 substantially improved the balance sheets of households, businesses, and banks, making them more resilient to rate increases. Despite tighter credit, demand remains steady or is even improving.

The S&P 500 P/E ratio has compressed from 23x to 19x, and historical evidence shows that the relationship between moves in 10-year bond yields and valuations is inconclusive.

To the extent that the adjustment toward a normalized rate environment remains gradual, earnings-per-share growth will drive valuations over the coming months.

M&G Reports Its Best Results Since 2019

| By Amaya Uriarte | 0 Comentarios

CC-BY-SA-2.0, FlickrAndrea Rossi, Chief Executive Officer of M&G plc, parent company of M&G Investments

In a market characterized by macroeconomic complexity, M&G plc has demonstrated the strength and resilience of its business model by recording its best half-year performance in seven years, consolidating a deep and successful transformation toward a low-capital-intensity operating profile. In this regard, Andrea Rossi, Chief Executive Officer of the Group, noted: “The business is delivering a solid performance, with an adjusted operating profit of £435 million [€504.6 million], up 15% year-on-year, representing our best first-half result since our IPO in 2019. We continue to execute our strategy, successfully orienting the Group toward high-quality, low-capital-intensity (capital-light) earnings, which now account for 80% of total adjusted operating profit.”

This robust performance is underpinned by operational milestones during the first half of 2026 that evidence the success of the corporate strategy. Despite environment volatility, the firm attracted net inflows into its open business worth £2.4 billion [€2.784 billion], an achievement primarily supported by M&G Investments, the Asset Management division, which drew net subscriptions from external clients worth £2.2 billion [€2.552 billion]. The firm reports that numbers were positive across both retail and institutional channels, backed by its expansion in the United Kingdom and internationally.

At the same time, M&G reinforced the diversification of this division by raising external client assets under management and administration to £189 billion [€219.24 billion]—equivalent to 53% of total assets under management for the segment—of which £110 billion [€127.6 billion] comes from international investors. This commercial dynamism also translated into a contribution of £13 million [€15.08 million] in new annualized net revenues within Asset Management, where investor interest in high-value solutions—especially in private markets, which recorded net inflows of £1.3 billion [€1.508 billion] and reached £83 billion [€96.32 billion] in assets—continues to serve as a strategic pillar of growth.

To contextualize these solid capital flows, Rossi added that “net inflows of £2.4 billion [€2.784 billion] in open business reflect the breadth and strength of our offering. Asset Management contributed £2.2 billion [€2.552 billion] in net inflows from external clients, of which £700 million [€812 million] was channeled through our strategic alliance with Dai-ichi Life Group.” This commercial success not only consolidates current figures, but accelerates the firm’s structural shift. Along these lines, the executive further elaborated on the group’s evolution, stating: “M&G continues to grow and transform, becoming a more diversified, efficient, and less capital-intensive business. With a clear strategy, disciplined execution, and the right resources, I am confident in our prospects for the second half of 2026 and our ability to deliver sustainable long-term value to our clients, partners, and shareholders.”

Maintaining the established plan

Looking ahead, the firm stated that it considers itself to be in a privileged position to sustain this financial momentum, relying on its competitive advantages in structurally growing markets. The company’s roadmap is firmly focused on preserving its financial strength, simplifying the organization, and driving profitable growth. In terms of profitability, the entity reiterates its commitment to achieving average annual pre-tax adjusted operating profit (AOP) growth of at least 5% for the 2025–2027 triennium.

Thanks to the business’s strong performance so far this year, management expects to close the 2026 financial year with a low double-digit increase in AOP on a full-year basis.

In parallel, the group is making progress toward its operational efficiency target after recording a cost-to-income ratio of 73% in the first half, with the expectation of continuing to improve it in the second half of the year to approach its 70% target. Likewise, the entity confirms that it is moving at an optimal pace to meet its cumulative operational capital generation target of £2.7 billion [€3.132 billion] for the 2025–2027 period.

Invesco Appoints Saúl Santamaría to Strengthen Its ETF Commercial Strategy in Latin America and US Offshore

| By Amaya Uriarte | 0 Comentarios

Invesco, one of the world’s leading independent investment managers, has appointed Saúl Santamaría to reinforce its commercial team and expand coverage for its ETF business in Latin America and the US Offshore market.

With this appointment, Invesco reinforces its commitment to these markets and its strategy to remain ever closer to its clients and distribution partners in the region. In his new role, Santamaría will work closely with institutional clients, distributors, and intermediary networks, contributing to the development of strategic relationships and the expansion of Invesco’s ETF platform.

This strategic move comes amid growing interest in ETFs as efficient, transparent, and flexible tools for portfolio construction. In recent years, Invesco has experienced strong growth in this segment and already holds over $20 billion in assets under management across ETFs in Latin America and US Offshore, consolidating its position as one of the leading providers in both markets.

Santamaría brings 20 years of international experience in the asset management industry, with a track record focused on fund distribution and business development in Latin America and US Offshore. Before joining Invesco, he served as Head of Distribution for US Offshore at Goldman Sachs Asset Management, where he led the commercial strategy for this market. Previously, he held senior positions at Compass Group, Carmignac, and Amundi, serving in various commercial management roles for Latin America, including opening Amundi’s office in Mexico and managing the regional distribution business. He began his professional career at Société Générale Asset Management (SGAM) in Paris.

He holds a degree in Finance and International Relations from Universidad Externado de Colombia and a Master of Science in Management from NEOMA Business School in France. He speaks Spanish, English, French, and Portuguese.

Santamaría will report to Laure Peyranne, Head of ETFs for Iberia, Latin America, and the US Offshore market. Peyranne noted that Santamaría’s appointment “reinforces our commitment to these markets and will allow us to continue staying closer to our clients. His extensive international experience in distribution, deep understanding of Latin America and US Offshore, and proven track record will be key as we continue to build our ETF business. We want to remain closely attuned to our clients’ needs, offering them top-tier service alongside innovative, efficient investment solutions tailored for portfolio construction.”

In addition, Íñigo Escudero, Country Head at Invesco for Southern Europe, Latin America, and US Offshore, emphasized that “Saúl’s support, Laure’s leadership, and our operational capabilities and infrastructure across Europe and the United States will allow us to continue expanding our footprint in markets with immense growth potential. Our ability to combine active management, ETFs, and specialized investment solutions puts us in a privileged position to meet our clients’ needs.”

With the addition of Saúl Santamaría, Invesco’s Madrid office will comprise 22 professionals. The Southern Europe, Latin America, and US Offshore region oversees a total of over $100 billion in assets under management as of July 31.

Within DWS’s CROCI Methodology: From a Value Framework to an Economic Measurement Framework

| By Amaya Uriarte | 0 Comentarios

Photo courtesyColin McKenzie, Head of the CROCI Strategy at DWS.

In this industry, having a sound methodology can mean the difference between the success of investment strategies and being just another manager. Since 1996, DWS has used its own proprietary valuation methodology to analyze global companies, known as CROCI. According to Colin McKenzie, Head of the CROCI Strategy at DWS, it is not merely a value framework—it is an economic measurement framework.

He notes that this approach allows them to identify opportunities across value, quality, and growth, and to build strategies capable of participating in vastly different market regimes while anchoring to the same underlying philosophy. In this interview, McKenzie discusses how the methodology has evolved, what it entails, and what it contributes to their investment strategies.

How has the CROCI model evolved?

The core objective of the CROCI methodology has remained unchanged for over 30 years; what has evolved is our capability to execute it, as corporate reporting standards and disclosure requirements have improved significantly over time. For instance, the model was enhanced to reflect the growing use of employee stock option plans in the early 2000s; adjustments for operating leases grew more sophisticated as disclosures improved (though, more recently, many have been brought fully onto the balance sheet under specific conditions); and, more recently, the expanding availability of ESG-related information has provided additional insight into companies’ long-term economic sustainability.

At the same time, the rise of intangible assets has made economic analysis more important than ever. Traditional accounting often treats investments in areas such as research and development, software, intellectual property, and brand building differently from physical investments, making comparisons across companies and sectors difficult. CROCI aims to correct these distortions wherever possible, enabling companies to be evaluated on a more economically consistent basis.

A defining feature is that it recalculates the balance sheets of hundreds of companies to derive their true Economic P/E. How often is the database for these companies reviewed and updated?

The CROCI database is continuously updated by a dedicated team of analysts who review company models whenever new financial information becomes available. Across our entire global coverage, this accounts for approximately 70,000 hours of company analysis and database updates each year. Each company is reviewed using a consistent economic framework, which helps ensure comparability across sectors, regions, and accounting regimes.

This depth of research is one of the main differentiating factors of the CROCI process and reflects the importance we place on understanding the true economic position of every business. At the same time, the process is designed to be agile. Under normal market conditions, company models are continuously updated as new information arrives. However, during periods of exceptional economic shift or uncertainty, we can accelerate the process significantly.

This combination of analytical depth and responsiveness enables us to maintain discipline, even during periods of market volatility and earnings seasons. While market sentiment and stock prices can swing rapidly, our goal remains ensuring that the underlying economic data is as current and comparable as possible. As valuations adjust, the investment process can respond efficiently using the latest fundamental company data without needing to alter the core investment philosophy.

Why is the Cash Return on Capital Invested metric particularly useful for fund selectors today compared to traditional P/E or Price-to-Book ratios?

Traditional valuation metrics, such as the price-to-earnings (P/E) ratio or price-to-book ratio, can be useful, but they are heavily influenced by accounting conventions and often fail to offer a consistent foundation for comparing companies across different sectors, countries, and business models. This challenge has become even more acute in a world where intangible assets, intellectual property, and software play an increasingly central role in value creation.

The CROCI framework addresses this by rebuilding these indicators from an economic perspective, creating a consistent measure of the capital invested in a company and the cash returns generated by that capital. Investors can view this as conducting venture capital-style due diligence on publicly traded equities.

What advantages does this offer?

This allows us not only to calculate a more meaningful valuation indicator, such as the Economic P/E, but also to derive consistent measures of quality—through the cash return on capital invested—and growth—through changes in a company’s underlying economic earnings power. This distinction is vital because, ultimately, investors need to understand not just how much they are paying, but why they are paying it. By placing valuation, quality, and growth on the same economic footing, CROCI enables investors to compare companies on truly equivalent terms.

For fund selectors, this can be especially valuable in today’s market environment, where valuation dispersion remains elevated and accounting indicators often struggle to reflect the true economic reality of modern businesses. The strength of the CROCI framework lies in providing a consistent lens through which to evaluate valuation, quality, and growth together, allowing capital to be allocated based on economic reality rather than accounting presentation.

Today’s quantitative universe is dominated by multi-factor strategies driven by big data or advanced algorithms. What sets CROCI’s quantitative approach apart?

We view CROCI as an active, systematic approach, so in many respects it can be seen as a blend of both. Portfolio construction is systematic and rules-based, which brings consistency, transparency, and repeatability. However, the foundation of the process is fundamentally research-driven, rather than relying on statistical factor mining or purely data-driven optimization.

The most important part of CROCI is not the portfolio algorithm, but the underlying economic analysis of the companies. Our analysts reconstruct financial statements to understand how companies actually create value, generate cash flows, and earn returns on capital.

For that reason, we often describe CROCI as a systematic approach to fundamental investing. The research process is grounded in fundamental analysis, while portfolio execution is systematic. This combination allows us to apply the discipline of quantitative investing without losing sight of the economic realities of the companies in which we invest.

AI Will Transform Asset Management Operations

| By Amaya Uriarte | 0 Comentarios

A global study of 178 senior asset management executives published today by Clearwater Analytics reveals a decisive shift in the asset management industry: a majority of managers expect artificial intelligence to transform their front-, middle-, and back-office operational functions over the next 12 months. The study, titled “GenAI and the Data Divide,” indicates that 62% of managers expect AI to transform how firms generate and synthesize information, 58% expect a radical change in decision-support systems and portfolio recommendations, and 57% anticipate a transformative impact on predictive modeling and stress testing.

Adoption is accelerating in tandem: 95% of firms increased their budget allocated to AI last year, and 85% plan to increase it by at least an additional 50% over the next 12 months. However, the analysis also identifies the key factor in capturing this transformation: a 23 percentage point gap exists between how entities value the completeness of their data versus its accuracy. While 79% consider their data to be complete, only 56% believe it to be accurate. This divide is emerging as the primary differentiator between firms realizing measurable returns on their information and those still waiting to monetize it.

A Year of Operational Transformation

The report reflects significant consensus among investment professionals regarding where AI will deliver the deepest impact over the next 12 months. Leading the list is content automation and data synthesis: 62% of managers are confident that AI will facilitate a profound or transformative shift in generating standardized reports and synthesizing complex data into concise summaries.

The industry’s reliance on predictive modeling will also undergo an AI-driven overhaul. Fifty-seven percent of respondents anticipate a transformative impact on how their firms analyze historical and current data to forecast results and evaluate stress-testing scenarios. Close behind, 58% expect AI to revolutionize decision-support systems, specifically by proposing potential actions or parameter adjustments, such as rebalancing portfolios based on specific objectives and constraints.

Souvik Das, Chief Technology Officer (CTO) at Clearwater Analytics, stated: “Our data shows that the global investment community is no longer just curious about AI. It is deploying it to solve the most labor-intensive operational tasks in asset management. By automating the heavy lifting of data synthesis and scenario modeling, firms are reclaiming thousands of hours that can now be redirected toward alpha-generating activities.”

Tactical Success in Day-to-Day Operations

The study also provides an assessment of the effectiveness of AI tools currently in use. Far from being a theoretical benefit, AI is already delivering measurable tactical advantages in daily work.

The first advantage is natural language interaction: 73% of surveyed managers rate the use of natural language AI agents to query data-dense investment platforms, risk management systems, and reconciliation tools as “effective.” Second is deep analysis: 62% of respondents consider AI agents effective for delving into complex topics like regulatory compliance, with nearly half (47%) describing these tools as “very effective.”

Third is workflow automation: The drive toward straight-through processing continues to gain momentum, with 63% of managers successfully using AI to automate repetitive workflows, such as daily report generation. The final advantage is multi-agent orchestration: 62% of firms report success in using AI to trigger operations based on data thresholds or specific schedules, indicating progress toward more autonomous and sophisticated system behaviors.

Solving the Data Dilemma

Data quality has historically been one of the industry’s greatest challenges. This study demonstrates that managers now understand why it is more critical than ever. Seventy percent of surveyed professionals note that deploying AI has intensified their focus on data governance, with 8% describing this shift in focus as “drastic.” Two-thirds (66%) consider their AI tools effective in managing the intricacies of alternative data—an area historically complex to scale.

That progress in alternative data is real. However, it has failed to close the truly decisive gap: only 56% of firms rate their data as accurate or reliable, compared to 79% that consider it complete. AI is focusing attention on data, but it has not yet resolved the underlying trust issue.

“What is striking is that AI adoption is forcing fund managers to confront data management fundamentals like nothing ever has before,” adds Souvik Das. “The confidence observed in alternative data management is telling. It suggests that firms investing in AI are also the ones investing most in ensuring data accuracy, and that both priorities must advance hand in hand. It represents a fundamental shift in how the industry perceives complexity,” he concludes.

Divergence in Adoption

Although most of the sector demonstrates an optimistic stance, the study highlights a growing divide between leaders and laggards. In several areas—such as software delivery and workflow coordination—between 12% and 18% of managers still foresee “little or minor impact” from AI. This divergence suggests that while the technology is ready, firms’ internal infrastructure and cultural maturity vary significantly.

The Impressions Left by Kevin Warsh’s First Jackson Hole

| By Amaya Uriarte | 0 Comentarios

Wikimedia CommonsKevin Warsh, Chair of the US Federal Reserve

At a time when monetary policy and interest rates are front and center, all eyes have recently been turned toward the US Federal Reserve and its new chair: Kevin Warsh. Last week, during the central bankers’ symposium in Jackson Hole—held in the town of the same name in Wyoming—the official surprised global investors with a tone that was somewhat more hawkish than expected.

The event served as a platform for the economist to reaffirm his commitment to the fight against inflation. This left international markets with the impression that reference rate hikes could occur in the North American country this year. However, Warsh did not refer to the Treasury’s announcement regarding increased government bond buybacks.

“Warsh did not surprise much at Jackson Hole, maintaining a generally hawkish tone and a commitment to price stability without signaling an imminent rate hike or setting a policy threshold,” noted Alessia Berardi, Head of Global Macroeconomics at the Amundi Investment Institute. This message, she explained, represents a “major hurdle” for rate cuts and maintains a higher-for-longer bias, with further tightening still possible if inflation accelerates.

“The speech confirmed little appetite for alternative views on what matters most to the Fed and a limited preference for forward guidance. Short-term interest rates will remain the primary tool, with unconventional tools playing only a limited role,” the professional noted.

From EBC Financial Group, market analyst Felipe Mendoza agrees with the diagnosis. In his view, Warsh’s somewhat hawkish tone deviated from market expectations and emphasized the 2% target for inflation. “This stance could reaffirm that the Federal Reserve will prioritize the fight against inflation even if it means extending or tightening the monetary cycle, immediately raising the probability of a September rate hike to 50% in the futures market,” he stated.

Market Expectations

Broadly speaking, the Fed chair’s remarks do not stray from the norm. For Paul Donovan, Chief Economist at UBS Global Wealth Management, the content of the speech “was not particularly deep,” emphasizing consumer prices rising above 3%, without mentioning the impact of tariffs driven by Donald Trump’s White House on them. “In the absence of any inflation shock, the comments are consistent with stable US monetary policy,” he noted.

What stands out about this particular speech—Warsh’s first at Jackson Hole—is that it follows a Fed meeting that felt different, marking a style that is harder for investors to read.

On this occasion, wrote Seema Shah, Global Strategist at Principal Asset Management, “Warsh cleared up much of the ambiguity left by the July FOMC press conference, providing a clearer picture of a Federal Reserve that keeps its focus firmly on bringing inflation back to its target and is prepared to raise rates if progress stalls.”

While the expectation at Principal—and among other global market participants—is that upcoming inflation data will show improvement, the probability of a rate hike in September increased. “The positive market reaction highlights that investors value clarity in monetary policy, even when that clarity comes accompanied by a more restrictive message,” Shah said.

For Mendoza at EBC Financial Group, the market reaction is less conclusive. “The asset response to this speech reflects a hasty recalibration of expectations in an environment of high volatility. The initial strength of the dollar and the correction in the S&P 500 responded to short-term rate adjustments; however, market dynamics showed interesting decoupling nuances,” he commented. “Following the initial impact of the remarks, markets eased and even reversed their initial direction,” he added.

For the analyst, this “mixed reaction across different assets suggests that the market has not yet fully priced in the scenario.”

A New Style at the Fed

The Fed is always on the radar of international financial institutions, given the importance of US interest rates to the global economy. But in the Warsh era, investors are paying particularly close attention, searching for signals in an environment of lower visibility.

“From day one, Warsh has abandoned forward guidance. He wants financial markets to assess economic prospects rather than be guided by a Fed that telegraphs its moves; in this way, as he has argued, market pricing will provide useful information to the Fed itself,” explained Sonal Desai, CIO of Fixed Income at Franklin Templeton, in a recent market commentary.

Furthermore, for some, this presentation put the spotlight on the Fed’s credibility at a time when global capital is growing increasingly nervous about US debt.

“US risk assets have performed well for years, but bond investors are increasingly demanding compensation in the form of higher yields,” stressed Allianz GI in a commentary authored by Chief Economist Christian Schulz and Fixed Income CIO Jenny Zeng.

As the professionals explained, “bond investors have to absorb growing financing needs stemming from investment in artificial intelligence, high fiscal deficits, and debt refinancing.” This occurs, they added, in an environment where some of the primary sources of demand are weakening, as households are saving less, the Fed continues to shrink its balance sheet, and international investors are diversifying their reserves.

Guide Compiles Guidelines for Foreign Investors in the Brazilian Market

| By Amaya Uriarte | 0 Comentarios

A new guide aimed at international investors compiles information on accessing and operating in Brazil’s financial and capital markets. The Non-Resident Investors Guide for Investing in the Brazilian Financial and Capital Markets outlines the main regulatory, operational, and tax requirements applicable to investors domiciled abroad.

The publication, created by the Brazilian Financial and Capital Markets Association (Anbima), brings together the main instruments available in the country and addresses features of the Brazilian market that may differ from practices adopted in other jurisdictions.

The release comes following changes to Brazilian foreign exchange and foreign investment rules. In recent years, regulations governing non-resident investors have undergone modifications aimed at “enhancing legal certainty, aligning local rules with international standards, and eliminating redundant requirements.”

The guide outlines the structure of Brazil’s financial and capital markets and the role of key regulatory bodies. It also details the framework applicable to non-resident investors and specific rules for foreign portfolio investment—a regime covering investments in marketable securities, financial assets, and federal government bonds.

Among the practical guidelines are details regarding eligible assets, hiring local service providers, registrations with Brazilian authorities, and customer identification and Know Your Customer (KYC) procedures. Requirements may vary based on investor profile, investment type, and the method of capital entry.

Additionally, the publication includes a matrix summarizing scenarios in which appointing a local representative and registering with the Securities and Exchange Commission of Brazil (CVM) are required.

According to the document, the current framework relaxes certain representation and registration requirements under specific circumstances. The guide explains how non-resident accounts denominated in reais can be used to invest funds already held in Brazil, and under what conditions investors accessing the market through eligible foreign intermediaries can utilize simplified registration procedures.

Investments and Taxation

The guide presents the instruments available to international investors, including stocks, corporate bonds and other debt securities, investment funds, derivatives, financial assets, and federal government bonds. The document also addresses product characteristics, trading and settlement rules, risks, and tax treatment.

In the tax section, the publication details rules applicable to foreign portfolio investors and differences that may arise based on investor jurisdiction and asset type.

Certain instruments feature specific incentives. This is the case with incentivized debentures, where yield may be subject to a “zero percent income tax rate” for eligible non-resident investors not domiciled in a favored tax jurisdiction (tax haven).

The publication was developed as a practical reference rather than an exhaustive legal or tax manual. Given variations in requirements and exceptions depending on the investment and investor profile, the guide recommends seeking professional advice when evaluating specific decisions.

Tariffs, Speculators, and Shrinking Supply: What is Behind the Surge in Copper Prices

| By Amaya Uriarte | 0 Comentarios

Commodity markets have long been in the spotlight for investors. Recently, attention has focused on metals—specifically copper. At the root of this is the recent surge in its market price driven by the Democratic Republic of the Congo’s (DRC) ban on copper concentrate exports, “which exacerbated an already tight market situation,” according to UBS.

The firm highlights another destabilizing factor: copper production in Chile and Peru has continued to be “disappointing,” with cumulative year-to-date output down 4% compared to the same period last year, despite a 2% year-over-year uptick in June. “Weather-related disruptions in Chile and slow project ramp-ups have weighed on supply,” the firm notes.

Adding to these supply-side issues are pressures on the demand side. In this regard, UBS points to an increase in shipments to the United States ahead of a potential decision on refined copper imports as an additional source of tension, “which has drawn metal into the country, reshaped global trade flows, and drawn down inventories in other regions.”

Carsten Menke, Head of Next Generation Research at Julius Baer, notes that the White House “has remained very quiet on the topic of copper import tariffs, and President Trump’s apparent strategy of doing nothing is becoming increasingly evident to the market.” In this environment, the US “continues to import refined metal, depleting stocks in other regions and thereby pushing prices to historic highs.” On this point, Menke emphasizes that since there is no deadline for President Donald Trump to make a decision, “the trend is expected to continue in the short term.”

Is the Situation Sustainable?

Menke argues that the current market shortage “is artificial, not real,” suggesting that “prices should return to levels more justified by fundamentals over the medium term.” He explains that the US copper market review related to tariffs “should have been carried out nearly two months ago.” Until now, Menke continues, “the White House has maintained silence on the matter, suggesting that President Donald Trump has not yet made up his mind about imposing tariffs on refined metal imports.” The US is a major net importer of refined copper, primarily from Canada, Chile, and Peru. At the same time, it is a net exporter of ores and concentrates due to a lack of domestic smelting and refining capacity.

“Trump has the following options: import tariffs of 15% starting in January 2027 and/or 30% starting in January 2028; imposing no tariffs; or doing nothing. Doing nothing means leaving the copper market in limbo, which appears to be the president’s strategy right now. The result is that the US continues importing refined metal, which continues to accumulate as inventory,” Menke argues.

This situation drives price increases, which are further accelerated by very bullish positioning from short-term and speculative traders in US futures markets. “For once, Chinese traders appear to be sitting on the sidelines of the speculation,” says Menke, adding that because Donald Trump faces no deadline to act, “copper prices are expected to remain elevated, at least in the short term,” even though they should return to fundamentally justified levels over the medium term.

At UBS, analysts believe global copper demand remains supported by resilient economic activity, steady growth in China, and artificial intelligence-related investment across Asia—as copper, among other commodities, is used in cables, power systems for vehicles, and electrical grids, as noted by Aneeka Gupta, Director of Macroeconomic Research at WisdomTree. Therefore, “given that the market is likely to remain in deficit through the end of the year, price weakness should be limited,” leading the firm to maintain a constructive outlook on copper, expecting prices to hit their target of $15,500/MT in the coming quarters and recommending long exposure.

However, other firms see risks in this scenario. Bank of America notes that while investments in energy resilience will accelerate and supply constraints are expected to keep the market in deficit through 2026 and 2027, they also point out that metals demand in China has slowed and could grow by just 0.5% year-over-year in 2026—the weakest growth since 1988. Additionally, demand in Europe and the United States is slowing down due to the war with Iran.

As downside risks to copper prices, the firm points to the impact of trade wars on confidence, potential re-exports from China, and a “drastic slowdown” in global demand next year.

BCP Miami Begins Operations as a Branch

| By Amaya Uriarte | 0 Comentarios

In line with Credicorp’s regional growth strategy, the group’s bank, BCP, announced that its Miami operation has initiated activities as a full bank branch. With this new license, in addition to continuing to serve clients linked to BCP and Credicorp in Peru, Chile, Colombia, Bolivia, among others, it can now also serve companies incorporated in the United States, as detailed in a press release.

After receiving authorization from the US Federal Reserve and the Florida Office of Financial Regulation (OFR), BCP Miami Agency, located in Coral Gables, Florida, officially converted into a branch this past July. Thus, this framework grants it greater operational capabilities to expand business in the US market. Now, the institution will be able to offer financial services to subsidiaries, holding companies, investment vehicles, and other entities linked to its clients’ corporate groups in the United States.

“An increasing number of companies are conducting business between the United States and Latin America, and we want to continue being their partner in that growth. The conversion of BCP Miami into a bank branch allows us to serve more companies and do so with a much more comprehensive offering. For our current clients, this brings added value: if they already work with BCP or any Credicorp company, we already know their business and can accompany them in their operations within the United States as well, all from a single financial institution,” stated Mark Talbot, CEO of BCP Miami, in the press release.

The new branch will continue to offer corporate accounts in US dollars and euros, domestic and international wire transfers, payment solutions, digital banking, treasury products, and corporate financing—services that will now also be available to US-incorporated entities under the bank’s regulatory and compliance standards.

“Our goal is to grow alongside our clients and continue strengthening our value proposition to support them wherever they conduct business. We aim to add around 100 new corporate clients by 2027 and consolidate our position as a benchmark bank for companies operating in the United States and the countries where Credicorp is present,” concluded the executive.

With this milestone, BCP strengthened its international positioning and consolidated its presence in one of the world’s leading financial markets.

Panama Tops the New Ranking of Investment Migration Programs in Latin America

| By Amaya Uriarte | 0 Comentarios

According to an analysis that includes most of the major Latin American economies, Panama leads the combined ranking of investment migration programs developed by Global Citizen Solutions (GCS), a consulting firm specializing in citizenship and residency advisory services. This was explained in a press release, detailing that the Central American country achieved a score of 84.4 points, topping the list in the latest version of Investment Migration Programs in Latin America: A Comparative Analysis.

It was followed by Paraguay (80.1 points) and the Dominican Republic (77.7), with all three ranking ahead of Costa Rica, Ecuador, Uruguay, Brazil, Colombia, Mexico, Peru, and Chile. The briefing evaluates eleven active residency programs in the region based on four criteria: processing speed, tax attractiveness, investment flexibility, and freedom of presence.

Panama is the most consistently competitive across all four evaluated dimensions, while Paraguay offers the best cost-benefit ratio. For its part, Costa Rica sacrifices speed in exchange for flexibility; and Colombia is the fastest on paper, but the least flexible regarding presence requirements. Mexico, the second-largest economy in the region, sits in the middle of the table despite capturing the second-largest share of regional investment; and Chile leads in quality of life, but ranks last as a program.

North America: The Main Source of Demand for Panama

Approvals for Panama’s Qualified Investor program increased by 75% in 2024, from 187 to 327, while those for Real Estate Self-Sufficiency more than doubled, from 63 to 133. The program has approved around 25 qualified investor applications per month, against a target of 150—a sixfold increase—driven by a shift in its applicant base: US citizens have surpassed Colombians as the largest individual group.

Panama leads the combined program ranking, placing first or second across the four evaluated dimensions, boasting the region’s broadest range of qualifying assets—from real estate and securities to bank deposits and forestry—and with no minimum physical presence requirement.

The shift in investor visa demand reflects a broader capital narrative. Foreign Direct Investment into Latin America and the Caribbean reached $194.233 billion in 2025, up 1.7% from the previous year, with Brazil and Mexico jointly absorbing 62% of the flows. Amazon, Microsoft, and Google have collectively committed approximately $23 billion to the region as part of a global artificial intelligence infrastructure expansion in which the four major US tech giants are expected to invest nearly $700 billion in the coming years.

Microsoft alone has committed $2.7 billion for cloud and AI infrastructure in Brazil, $3.3 billion for its data center region in Chile, and $1.3 billion for Mexico through 2027. Cross-border M&A activity follows the same trajectory: transaction value in Mexico grew 86% year-on-year to nearly $32.5 billion in 2025, driven mainly by US and European buyers.

The MSCI Latin America Emerging Markets Index returned 56% in 2025 and still trades at a 43% discount relative to global markets—a gap partly explained by growing demand for AI-linked raw materials supplied by the region. The “Lithium Triangle” formed by Chile, Argentina, and Bolivia holds approximately 50% of the world’s identified lithium reserves, while Chile, Peru, and Mexico supply nearly 40% of global copper, both critical inputs for data center expansion and the energy transition underpinning the AI economy. The collective wealth of Latin America’s high-net-worth individuals (HNWIs) grew 5.1% in 2025, with Brazil (+6.0%) and Mexico (+5.4%) both beating the regional average.

Panama: The Region’s Most Balanced Program

Panama’s advantage stems from an absence of weaknesses rather than a single standout feature. It ranks first or second in all four evaluated dimensions and offers the region’s widest range of qualifying assets: real estate from $300,000, securities from $500,000, bank deposits from $750,000, or forestry investments between $100,000 and $800,000, with no mandatory minimum stay requirement. Approval volumes hit record numbers in 2024. Today, Panama approves about 25 qualified investor applications a month and has set a goal to reach 150, with US citizens having overtaken Colombians as its largest applicant pool.

On the other hand, Paraguay combines a $70,000 threshold with the lowest tax rates in the region—10% corporate and between 8% and 10% personal—and a presence requirement of just one visit every three years. The country granted 29,765 residencies in the first half of 2026, up 81% compared to the same period in 2025, with Brazilian citizens accounting for 76% of those grants. Its new Investor Pass, introduced in April 2026, grants direct permanent residency and adds investment pathways in real estate, financial assets, and tourism to what was previously a single business route.

Colombia, meanwhile, resolves applications in just two to four weeks—faster than any other program evaluated—but with less predictable timelines and more demanding documentation, placing it eighth in the overall standings. It is also the most demanding regarding physical presence, requiring 180 days of stay per year to keep the permit active—a requirement that, according to the report, effectively rules out investors unwilling to physically reside in the country. Colombia is one of only four programs in the region that extends eligibility to the applicant’s parents, in addition to the spouse and dependent children.

Costa Rica ranks fourth overall, sacrificing processing speed (7th out of 11) in exchange for one of the broadest ranges of qualifying investments in the region, including real estate, listed shares, and a rentista income pathway of $2,500 per month. It is one of four countries, alongside Chile, Uruguay, and Panama, that lead the region in quality of life, making it a natural choice for investors planning to actually reside in the country rather than simply maintain a permit.

Chile leads the region as a place to live, but ends up last among the eleven evaluated programs, trailing in tax efficiency, flexibility, and presence options, while ranking 8th out of 11 in speed. Its single qualifying pathway—a business investment sponsored by InvestChile that excludes real estate—reflects a program designed to attract operational businesses rather than internationally mobile capital. The Chilean passport ties with Brazil’s as the strongest of the eleven, offering visa-free or visa-on-arrival access to 177 destinations. Along with Argentina and Bolivia, Chile is part of the “Lithium Triangle,” which holds roughly 50% of the world’s identified lithium reserves, and together with Peru and Mexico supplies around 40% of global copper.

Mexico is the second-largest economy in the region, with a projected GDP of $2.12 trillion for 2026, and captured $43.221 billion in Foreign Direct Investment in 2025—accounting for 22% of the regional total, behind only Brazil. Microsoft has committed approximately $1.3 billion to Mexican infrastructure through 2027, and cross-border M&A activity grew 86% year-on-year to roughly $32.5 billion, driven largely by US and European buyers. However, its residency program, based on proof of economic solvency rather than a formal investment structure, ranks 9th out of 11. It does, however, combine worldwide income taxation with the lack of a strict minimum stay—one of the few such combinations in the region.

Brazil is the largest economy in the region and its main destination for AI infrastructure investment, having captured 40% of regional FDI in 2025. Despite offering entry costs starting at just $30,000, its residency program ranks 7th overall, and its real estate investment option has attracted fewer than 700 applicants in five years—a gap the report attributes to a lack of awareness and external advisory presence rather than program design.

Price Is a Weak Indicator of Program Quality

Among the eleven programs, GCS’s analysis finds that cost bears little relation to performance. Ecuador, with an investment threshold of $48,200, ranks 5th overall, and Paraguay, at $70,000, ranks 2nd. Uruguay, whose $2 million threshold is more than forty times that of Ecuador, ranks 6th.

This momentum is reinforced by pullbacks in other regions: Spain eliminated its golden visa in April 2025, Portugal removed its real estate investment pathway and extended naturalization timelines under a law effective since May 2026, and Greece tripled its investment threshold in prime areas, leading to a 24% drop in foreign property acquisitions under its program. For North American investors, the combination of accelerating capital flows and an expanding menu of residency options positions Latin America as a third hub for investment migration—complementing, rather than competing with, an increasingly restrictive European market.

“Latin America remains highly underrated, with programs offering real potential and passports that grant mobility. They complement Europe’s residency programs and the Caribbean’s citizenship offerings, while competing on cost, speed, naturalization timelines, and access to a broader regional mobility zone,” stated Patricia Casaburi, Founder and CEO of Global Citizen Solutions.