Recent sharp falls in the Brazilian real and Mexican peso will add to concerns at their respective central banks. We now expect no further rate cuts in Brazil this year and the risks to our already-hawkish rate profile in Mexico lie to the upside. Elsewhere, Argentine President Javier Milei secured his first major legislative success this week, which will help to improve the fiscal position and Argentina's longer-term growth prospects. This was received positively by investors, but the government still has more work to do, especially when it comes to addressing the overvalued exchange rate.
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