The Colombian peso, currently the world’s best-performing currency for the year, is rising above 4,000 per USD and attaining its highest value since June 2022. The peso appreciated by 21.2% year-to-date. A high volume of USD inflows through the spot market combined with low liquidity for arbitrage is pushing the currency’s forward points higher, appealing to carry traders despite high volatility. Colombia has the region’s highest one-month implied yields at 16.55%.