Latin America Rapid Response Mexico Interest Rate Announcement (Feb.) Mexico’s central bank delivered a larger-than-expected 50bp interest rate hike, to 11.00%, today most probably because the recent uptick in services inflation spooked the Board. Another rate hike... 9th February 2023 · 2 mins read
Latin America Data Response Brazil & Mexico CPI (Jan.) Mexico’s headline inflation rate edged up to 7.9% y/y in January, setting the scene for Banxico to raise interest rates by 25bp, to 10.75%, later today. We think that this will mark the end of the... 9th February 2023 · 2 mins read
Latin America Economics Update Lula and the threat to the BCB’s independence Brazil’s president Lula seems to be on the warpath in his quest for lower interest rates and now has the central bank’s (BCB’s) independence in his sights. Were Lula to get his way, the experience... 8th February 2023 · 3 mins read
Latin America Economics Update Brazil’s BNDES: new leader, old problems The newly-appointed head of the Brazilian development bank, BNDES, takes charge today and is likely to be under pressure to increase lending. But the experience from the 2000s suggests that credit... 6th February 2023 · 3 mins read
Latin America Economics Weekly Weak survey data, inflation concerns, rate forecasts The batch of survey data for January released this made for pretty depressing reading and reinforces our view that, despite the boost from commodities, regional growth will slow sharply this year... 3rd February 2023 · 7 mins read
Latin America Data Response Brazil Industrial Production (Dec.) The stagnation in Brazilian industrial production in December is consistent with a 0.5% q/q fall in output over Q4 as whole, indicating that the sector was a drag on the economy. And the early signs... 3rd February 2023 · 2 mins read
Emerging Markets Economics Update China’s re-opening and EMs: three key questions We’ve received a lot of questions recently about the impact of China’s re-opening on EMs, including at our monthly Drop-in today. This Update answers three key questions on the winners and losers, the... 2nd February 2023 · 4 mins read
Latin America Economics Update Lula’s hopes for a higher inflation target would backfire The suggestion by Brazil’s President Lula that the central bank’s inflation target should be raised is likely to be a bigger concern for the second half of his presidential term (2025-26) than the... 2nd February 2023 · 3 mins read
Emerging Markets Economics Update EM banks well placed to face rising loan losses EM banks will face an increase in loan losses this year, but the good news is that banking sectors on the whole appear well-placed to absorb these, particularly in parts of Latin America, Emerging... 2nd February 2023 · 4 mins read
Latin America Economics Update Brazil: Copom casts doubt on 2023 rate cuts The statement accompanying yesterday’s Brazilian central bank meeting, at which the Selic rate was left at 13.75%, hinted that interest rates may need to stay at their current high level into next... 2nd February 2023 · 3 mins read
Emerging Markets Economics Update EM industry: brighter outlook, but headwinds persist The manufacturing PMIs picked up in most emerging markets in January, offering hope that the worst for EM industry may have now passed. But activity remains soft against the backdrop of high interest... 1st February 2023 · 2 mins read
Latin America Economics Focus Brazil’s rapid wage growth flying under the radar The slowdown that we expect in Brazil’s economy should take some steam out of the labour market, but it looks like it won’t be enough to stop wages from rising at a rapid pace. This appears to be a... 1st February 2023 · 12 mins read
Latin America Economics Update Colombia: end of tightening cycle approaching The minutes to the Colombian central bank meeting last Friday revealed that worries about the growth outlook will bring the tightening cycle to a close soon. We expect the central bank to deliver one... 1st February 2023 · 3 mins read
Latin America Data Response Mexico GDP (Q4 Prov.) The 0.4% q/q rise in Mexican GDP in Q4 suggests that the economy held up better than its Latin American peers towards the end of last year. But even so, the economy in the midst of a slowdown, which... 31st January 2023 · 2 mins read
Latin America Chart Pack Region set for a slowdown despite China’s re-opening The outlook for Latin America has turned more positive at the start of the year as China has shifted away from its zero-Covid policy and commodity prices have rallied. But this comes against a... 30th January 2023 · 14 mins read
Latin America Economics Weekly Common currency, new FX forecasts, Bolivia’s lithium Argentina and Brazil’s plan to establish a common unit of account to increase bilateral trade and reduce their dependence on the dollar misdiagnoses the main impediments to both goals. Elsewhere... 27th January 2023 · 8 mins read
