INSUBCONTINENT EXCLUSIVE:

Morgan Stanley has issued a warning about the Colombian peso, which has appreciated 8% against the US dollar so far in 2025.The investment

exposure to risk.This comes as several Latin American currencies, including the Brazilian real and Chilean peso, have outperformed other

region.This aggressive monetary policy has shielded the currency from negative domestic developments, such as fiscal challenges and a

growing trade deficit.Morgan Stanley Flags Risks of Colombian Peso Overvaluation Amid Global Uncertainty

(Photo Internet reproduction)However, Morgan Stanley highlights that the peso is now one of the most overvalued currencies in its coverage

gains to carry trades, where investors profit from high-interest rates in Colombia

But it warns that these gains may not last if global market volatility increases or risk sentiment shifts.A stronger peso also poses

cautious approaches in countries like Mexico and Chile

However, it advises investors to remain cautious, noting that shorting the peso is expensive due to high carry costs.The firm predicts

performance, offering critical insights for investors navigating emerging markets.