Latin America Economics Update Mexico: Cuts continue, but markets have gone too far After loosening policy again yesterday, Mexican policymakers will probably cut rates by another 75bp over the coming six months. Given that the US loosening cycle now seems to be at an end, market... 15th November 2019 · 3 mins read
Latin America Economics Update Chile’s protests: growing risk of longer disruption The sharp fall in the Chilean peso today amid widespread strikes will push up inflation although, with the central bank focused more on the hit to the economy, further interest rate cuts are still... 12th November 2019 · 3 mins read
Latin America Economics Update Peru cuts rates, strikes neutral tone The statement accompanying yesterday’s decision by Peru’s central bank to cut interest rates made it clear that this did not mark the beginning of an easing cycle. And with inflation and economic... 8th November 2019 · 3 mins read
Latin America Economics Update Taking stock of the Chilean protests There is a good chance that protests caused GDP to contract in Q4. While we expect growth to strengthen by next year, the weak starting point from Q4 has prompted us to revise down our 2020 growth... 7th November 2019 · 4 mins read
Latin America Economics Update Five points on Brazil’s fiscal reform package The fiscal package presented to Brazil’s congress yesterday shows that the government is not resting on its laurels after its successful pension reform. However, the good news on fiscal reform already... 6th November 2019 · 3 mins read
Latin America Economics Update Colombian household spending set to weaken Colombia’s economic recovery since 2017 has been in large part due to strength in private consumption, but we think it will likely slow in the coming quarters. This is one reason why our 2020 growth... 4th November 2019 · 2 mins read
Latin America Economics Update Brazil: One more cut and done The statement accompanying last night’s Copom meeting gave a clear signal that there will be just one more 50bp interest rate cut in the current cycle (to 4.50%), which should temper expectations in... 31st October 2019 · 3 mins read
Latin America Economics Update A closer look at Ecuador’s fiscal challenges Ecuador’s government has successfully stabilised the debt-to-GDP ratio, and it remains committed to IMF plans to cut the public debt ratio to just 30% of GDP. But the president’s climbdown in the face... 29th October 2019 · 3 mins read
Latin America Economics Update Argentina: First thoughts following Fernández win There is still a lot of uncertainty following Alberto Fernández’s widely-expected victory in Argentina’s presidential election, but one point we would stress is that a large debt write-down will... 28th October 2019 · 4 mins read
Latin America Economics Update Chile cuts rates, drops heavy hints for more easing Chilean policymakers’ decision to cut their key interest rate by 25bp yesterday and the dovish tone of the accompanying statement supports our view that the easing cycle has further to run. We... 24th October 2019 · 3 mins read
Latin America Economics Update What would a Fernández win mean for Argentina? Left-wing Peronist Alberto Fernández is widely expected to win Sunday’s presidential election, and we think that his tenure would be marked by more accommodative policy, persistently high inflation... 23rd October 2019 · 4 mins read
Latin America Economics Update First thoughts on the protests in Chile As things stand, there are reasons to think that the protests that erupted in Chile in recent days will have a relatively small impact on the economy and financial markets. The central bank is likely... 21st October 2019 · 3 mins read
Latin America Economics Update Brazilian rate expectations: is exuberance setting in? The shift in market expectations in Brazil towards much larger interest rate cuts by early 2020 now looks overdone. However, expectations for the Selic rate over a longer time horizon (2-5 years) look... 17th October 2019 · 3 mins read
Latin America Economics Update Brazil: Lower rates won’t lead to a lending revival The monetary transmission mechanism in Brazil seems to have weakened recently, which is likely to prevent the sharp fall in market interest rates seen since 2017 from feeding through to a significant... 10th October 2019 · 4 mins read
Latin America Economics Update Brazil: pension reform faces difficult final stretch Worsening relations between the Brazilian presidency and legislature threaten to delay the much-vaunted pension bill and will keep markets on tenterhooks in the coming weeks. It still looks like the... 3rd October 2019 · 3 mins read
Latin America Economics Update Weakness in Chilean consumption will be temporary Chile’s economic slowdown this year was mostly due to weaker private consumption, caused by a fall in consumer confidence. But with the labour market strengthening and copper prices likely to rise... 3rd October 2019 · 2 mins read
