Latin America Economics Update First thoughts on Colombia’s tax reform Colombia’s much-anticipated tax reform bill is impressive and, if passed by Congress, would put the public finances on a more sustainable footing. However, it would create some near-term economic pain... 25th October 2016 · 1 min read
Latin America Economics Update Mexico’s star begins to fade Mexico’s faltering economy probably escaped recession in Q3 – but it’s a close call. Our GDP growth forecast for this year was already below consensus but we are nudging it down from 2.0% to 1.8%... 20th October 2016 · 1 min read
Latin America Economics Update Brazil: rate cuts to remain gradual, for now The decision by Brazil’s COPOM to cut the benchmark Selic interest rate by only 25bp (rather than 50bp), combined with a slightly less dovish accompanying statement than some had expected, reinforces... 20th October 2016 · 1 min read
Latin America Economics Update Argentina: is Macri already a busted flush? The Argentine government’s recent upward revision to its 2017 budget deficit forecast has added to concerns that President Macri’s reform agenda is already starting to slow after less than a year in... 19th October 2016 · 1 min read
Latin America Economics Update Chile: MPC divided, but rates to remain on hold Chile’s central bank left interest rates on hold at 3.50%, although the MPC appears to be divided over whether to flag rate cuts or not. For now, we expect signs that the economy is recovering keep... 19th October 2016 · 1 min read
Latin America Economics Update Peru: Interest rates to rise by more than most expect The Peruvian central bank’s decision to keep interest rates on hold at 4.25% didn’t come as a surprise, but we expect a pick-up in inflation next year to trigger more rate hikes than the consensus... 14th October 2016 · 1 min read
Latin America Economics Update Colombians reject peace deal, main risks political Colombian voters’ rejection of the government’s peace deal with the FARC rebel group is unlikely to signal an immediate return to violence. And, while it is a significant blow to the economy’s medium... 3rd October 2016 · 1 min read
Latin America Economics Update Mexico raises rates to shore up the peso, further hikes likely The 50bp hike in Mexican interest rates (to 4.75%) at Thursday’s meeting was aimed squarely at supporting the peso. We expect another half-point increase at December’s meeting, taking rates to 5.25%. 29th September 2016 · 1 min read
Latin America Economics Update An anatomy of Brazil’s recession The depth of Brazil’s recession has been blamed on everything from lower global commodity prices and tightening domestic credit conditions to poor infrastructure and excessive red tape. But this... 29th September 2016 · 1 min read
Latin America Economics Update Mexican peso in the spotlight The sharp drop in the Mexican peso against the dollar this month, driven partly by Donald Trump’s surge in the US election polls, has increased the chances of an interest rate hike at Thursday’s MPC... 28th September 2016 · 1 min read
Latin America Economics Update Trump, the US election and the implications for Latin America Donald Trump’s performance in last night’s first US presidential election debate doesn’t appear to have done himself any favours, but his election in November is still a real possibility. This would... 27th September 2016 · 1 min read
Latin America Economics Update Argentina: Q2 GDP data not as bad as they appear The bigger-than-expected drop in Argentine GDP in Q2 was alarming, but it was due largely to a slump in exports, which should be temporary. The pace of contraction in domestic demand eased and the... 23rd September 2016 · 1 min read
Latin America Economics Update Food inflation to fall in Brazil and Colombia, but rise in Mexico Food inflation should ease over the coming months in Brazil and Colombia, which will help to bring down the headline inflation rates in both countries. By contrast, in Mexico, we expect the lagged... 21st September 2016 · 1 min read
Latin America Economics Update Venezuela: dodging near-term default, kicks can down the road An imminent restructuring of the short term dollar debt of Venezuela’s state-owned oil company, PDVSA, means that the severely cash-strapped government should avoid default over the next 12 months... 14th September 2016 · 1 min read
Latin America Economics Update Falling mining output to drag on regional recovery Q2 GDP data released across Latin America over the past month revealed that the mining sector was a key drag on growth in a number of economies. This looks set to continue as the lagged impact of... 13th September 2016 · 1 min read
Latin America Economics Update Mexico: big budget cuts to weigh on 2017 growth, mining sector Substantial cuts to government spending announced by Mexico’s new finance minister José Meade in the 2017 budget reinforce our view that GDP growth will be weaker than the consensus expects next year... 9th September 2016 · 1 min read
