Latin America Economics Update Banxico to keep rates high for longer than most expect Mexico’s central bank held its policy rate at 11.25% at today’s Board meeting, bringing the tightening cycle to an end. But with inflation unlikely to return to target until late-2024, policy will... 18th May 2023 · 4 mins read
Latin America Economics Update Best of Mexico’s recovery now over Mexico’s economy has put in a decent performance over the past year or so, but we think that most of the factors that have supported robust growth have now run their course. Tight policy and a looming... 17th May 2023 · 3 mins read
Latin America Economics Update Colombia: strong start to the year unlikely to be sustained The stronger-than-expected Q1 GDP data from Colombia suggest that the risks to our forecast for the economy to expand by 0.8% over 2023 as a whole are skewed to the upside. That said, there were signs... 16th May 2023 · 2 mins read
Latin America Economics Update Ecuador: political turmoil brings default risks back The looming impeachment trial of Ecuador’s president Guillermo Lasso marks a further intensification of the country’s political crisis and suggests that the recent experiment with market-friendly... 10th May 2023 · 6 mins read
Emerging Markets Economics Update How feasible is a BRICS currency? The idea of a new BRICS currency to settle trade or hold in reserves instead of the dollar has been doing the rounds recently. This could be modelled on the IMF’s Special Drawing Rights. But getting... 4th May 2023 · 6 mins read
Latin America Economics Update Copom pours cold water on near-term rate cut hopes Brazilian policymakers gave a firm push back against any expectations for imminent monetary easing at yesterday’s central bank meeting, supporting our view that interest rates will be lowered a bit... 4th May 2023 · 3 mins read
Latin America Economics Update Strength in exports unlikely to last The surge in exports from Latin America’s major economies in March suggests that the upside risks to our GDP growth and currency forecasts are building. But with advanced economies poised to fall into... 3rd May 2023 · 3 mins read
Latin America Economics Update Colombia: political risks back in the spotlight The replacement of Colombia’s market-friendly finance minister José Antonio Ocampo with a close ally of President Petro is likely to lead to a sell-off in Colombia’s financial assets when markets open... 27th April 2023 · 3 mins read
Latin America Economics Update Can Chile’s private sector cope with higher interest rates? There’s little evidence (so far) that the surge in interest rate is leading to widespread debt servicing problems in Chile’s private sector, but there are pockets of vulnerability in the household... 25th April 2023 · 4 mins read
Latin America Economics Update Chile’s central bank: still focused on inflation risks The Monetary Policy Report released by Chile’s central bank today revealed that policymakers are more concerned about inflation risks than we’d thought. We still think that Chile’s central bank will... 5th April 2023 · 3 mins read
Latin America Economics Update Drought to push Argentina’s economy into deep recession The historic drought afflicting Argentina will cause a steeper contraction in GDP than most expect this year and intensify balance of payments strains by reducing export earnings to the tune of 2-3%... 5th April 2023 · 3 mins read
Latin America Economics Update Banxico & BanRep close to but not at the end of their cycles Central banks in Mexico and Colombia both delivered 25bp hikes yesterday, and hinted that these could be the end of their cycles. But, on balance, we think that the strength of inflation will prompt... 31st March 2023 · 3 mins read
Latin America Economics Update Brazil’s new fiscal plans: yet to convince The new fiscal rule proposed today by Brazil’s finance minister would, if implemented in full, go some way towards stabilising the public debt ratio. But the government has a lot to do convince... 30th March 2023 · 3 mins read
Latin America Economics Update Brazil: Copom sticks to its guns The statement accompanying the Brazilian central bank’s decision to keep the Selic rate unchanged at 13.75% yesterday will have disappointed some (not least in the government) that thought global... 23rd March 2023 · 3 mins read
Global Economics Update What next after Credit Suisse? While the Credit Suisse rescue might draw a line under that particular institution’s problems, it is clear that confidence in the financial sector overall is still extremely fragile. So regardless of... 20th March 2023 · 5 mins read
Emerging Markets Economics Update A closer look at EMs’ exposure to bank flows A key channel through which emerging markets could be affected by the strains in the global banking sector is if lending by foreign banks falls sharply. On this front, EMs’ vulnerabilities have eased... 16th March 2023 · 3 mins read