The downside headline inflation surprises from some of the region's major economies this week mask the continued strength in underlying core services inflation. Stubborn underlying price pressures, alongside the stronger-than-expected US CPI data, support our view that central banks in Brazil and Chile will soon slow the pace of easing while Banxico will probably pause its easing cycle in May. Elsewhere, in Peru, the latest round of pensions withdrawals might support the struggling economy, but it could lead to volatility in the country's financial market and a build-up of fiscal risks further down the line.
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