Brazil

For Hot Money, Brazil Leads BRICs To Victory

Passers-by walk in front of the of Sao Paulo's Stocks Exchange (Bovespa) headquarters in downtown Sao Paulo Brazil on October 28, 2014. Brazilian stocks rose Tuesday, recovering some ground lost the previous day as traders digested the re-election of left-wing President Dilma Rousseff. AFP PHOTO / NELSON ALMEIDA (Photo credit should read NELSON ALMEIDA/AFP/Getty Images)
Passers-by walk in front of the of Sao Paulo’s Stocks Exchange (Bovespa) headquarters in downtown Sao Paulo Brazil on October 28, 2014. (NELSON ALMEIDA/AFP/Getty Images)

Last year it was Russia, this year the emerging market darling of Wall Street is Brazil. Interest rates are coming down, assets are distressed, equity prices are just right, for the most part, and local currency debt is still double digits. Never mind that Brazi is beating all of the big four emerging markets this year. Based on fund flow data alone, Brazil is in the pole position.

Brazil equity funds recorded their biggest inflow since early the fourth quarter of 2014 and dedicated BRIC equity funds posted consecutive weekly inflows for the first time in over five months, according to fund tracking firm EPFR Global in Cambridge, Mass.

Externally, Brazil is benefiting from hope that China, Europe and the U.S. will underpin demand for its commodity exports. Domestically,…

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