High energy prices have given a boost to terms of trade in many Latin American economies, in particular Brazil. But we expect most of the windfall to be saved and have therefore only nudged up our growth forecasts slightly. Inflation across the region has risen and many central banks, especially in the Andes, have struck a more cautious tone. The longer energy prices remain high, the bigger the risk of interest rate hikes. The key exception is Brazil where – given how high real interest rates are – we expect the central bank to continue to ease monetary policy, albeit at a more gradual pace.