Group 1 - The strategy of buying emerging market currencies with US dollars has yielded the highest returns in nearly a decade this year, with further potential for growth in the short term [1] - The Bloomberg index covering eight emerging market currencies has risen over 10% this year, potentially marking the largest annual increase since 2017, supported by dollar short positions [1] - Most emerging market central banks maintain a cautious policy stance, indicating the sustainability of real policy rates, while market expectations suggest a more dovish stance from the Federal Reserve by 2026 [3] Group 2 - The Bloomberg US Dollar Spot Index has declined by 7.8% this year due to concerns over the stability of the global reserve currency, exacerbated by the US's stringent tariff measures [3] - The Brazilian real has outperformed other currencies, appreciating over 20% against the dollar this year, with continued optimism from Citigroup regarding the Brazilian central bank's cautious policy stance [3] - Potential challenges for international assets, including emerging markets, may arise if the US economy transitions from a soft landing to a rebound and re-inflation phase, leading to a steeper US Treasury yield curve and a stronger dollar [3]