Latin America Economics Update A closer look at the jump in Brazilian inflation We estimate that all of the jump in inflation in Brazil over the past year can be explained by increases in government-regulated prices and a drought-related rise in food costs. Both of these effects... 23rd March 2015 · 1 min read
Latin America Economics Update Colombia’s central bank to tread carefully Interest rates in Colombia were left unchanged at 4.50% on Friday and, although the latest sell-off in the peso and above-target inflation has weakened the case for rate cuts in the near-term, we... 23rd March 2015 · 1 min read
Latin America Economics Update Shunto pay hikes still too small to lift inflation to 2% The early results from this year’s spring wage negotiations confirm that the tight labour market has boosted wage pressure. However, this year’s overall increase in labour income will likely still... 20th March 2015 · 1 min read
Latin America Economics Update Bank of Chile likely to bide its time Interest rates in Chile were left unchanged at 3% last night but the accompanying statement revealed a subtle shift in tone from the central bank, which now seems to think that inflation is likely to... 20th March 2015 · 1 min read
Latin America Economics Update Griesa deals another blow to Argentina Judge Griesa’s ruling that Citibank cannot process interest payments on Argentine government bonds that were issued under local law has dealt another blow to the authorities’ bid to return to... 13th March 2015 · 1 min read
Latin America Economics Update Currency concerns prevent interest rate cut in Peru The fact that the Peruvian nuevo sol has been caught up in the latest EM currency sell-off probably convinced policymakers to leave interest rates unchanged at 3.25% last night. But with economic... 13th March 2015 · 1 min read
Latin America Economics Update Currencies unlikely to go into freefall All of Latin America’s currencies will probably weaken further against the dollar in the near-term as we approach a first interest rate hike by the Fed. But with most currencies no longer appearing to... 12th March 2015 · 1 min read
Latin America Economics Update Political crisis now biggest threat to Brazil’s economy The corruption scandal at state-owned oil company, Petrobras, has developed over the past week or so into a full-blown national political crisis that, in our view, is now the biggest headwind facing... 11th March 2015 · 1 min read
Latin America Economics Update China unlikely to write a blank cheque for Lat Am The slump in commodity prices since last summer has exposed fragilities in the balance of payments of several economies in Latin America. But while that has left some governments looking to China for... 6th March 2015 · 1 min read
Latin America Economics Update Credit growth continues to cool, but concerns remain The slowdown in private sector lending growth across Latin America should help to ease concerns about the build-up of credit bubbles in the region. However, the accumulation of private sector debt... 3rd March 2015 · 1 min read
Latin America Economics Update Brazilian real hits weakest level in a decade The Brazilian real has tumbled to its weakest level against the dollar since 2005 in recent days. We suspect that this has more to do with deteriorating economic fundamentals and suggestions from... 26th February 2015 · 1 min read
Latin America Economics Update Not much cause for concern in Mexico’s current account Mexico’s current account deficit narrowed to 2.1% of GDP on a four-quarter sum in Q4 and, with the worst of the falls in oil prices now behind us, we think it could narrow a touch further to about 1.5... 25th February 2015 · 1 min read
Latin America Economics Update Colombia: case for interest rate cuts building Interest rates in Colombia were left unchanged at 4.50% on Friday but a slightly more dovish tone in the accompanying statement, combined with the announcement of budget cuts over the weekend... 23rd February 2015 · 1 min read
Latin America Economics Update Counting the cost of the Petrobras scandal It’s difficult to be precise, but we think the direct impact of the corruption scandal at Petrobras, including the effects of reduced investment by the company and others that have been implicated... 19th February 2015 · 1 min read
Latin America Economics Update No further rate cuts in Chile, but more to come in Peru Interest rates in both Chile and Peru were left unchanged last night and, while we do not expect further monetary stimulus in Chile as its economy is finally showing signs of strengthening, we think... 13th February 2015 · 1 min read
Latin America Economics Update Brazil edging towards an energy crisis An intensifying drought in Brazil has made it increasingly likely that the authorities will implement some form of power rationing over the coming months. Much remains uncertain, but we think that... 12th February 2015 · 1 min read
