Capital Daily EUR/USD: To parity and beyond? While the euro’s rapid fall over the past couple of weeks means that a lot of bad news about the euro-zone economy now appears to be discounted, the trends driving the common currency lower may... 12th July 2022 · 7 mins read
Latin America Data Response Mexico Industrial Production (May) Industrial production in Mexico rose by a disappointing 0.1% m/m and timely indicators suggest that the sector was even weaker still in June. With growth in the US weakening, we expect industrial... 12th July 2022 · 2 mins read
Latin America Economics Weekly Argentina, Banxico minutes, Brazil data dump While Argentina’s new finance minister has made some encouraging noises about sticking to the current IMF deal, there’s still no acknowledgement that the real exchange rate needs to weaken to restore... 8th July 2022 · 6 mins read
Latin America Data Response Brazil & Chile Consumer Prices (Jun.) The increases in inflation in Brazil (to 11.9% y/y) and Chile (to 12.5% y/y) last month set the ground for 50bp hikes in policy rates at their respective central banks’ next meetings (in Chile’s case... 8th July 2022 · 2 mins read
Latin America Data Response Mexico Consumer Prices (Jun.) The rise in Mexican inflation to 8.0% y/y, its highest rate since 2001, will sustain the hawkish shift seen on the Banxico Board at its latest meeting in June. A 75bp hike in the policy rate in August... 7th July 2022 · 2 mins read
Emerging Markets Economics Update How far are we through the EM tightening cycle? Tightening cycles in Latin America and Emerging Europe are already at an advanced stage. Some 70-80% of the likely rate hikes in their cycles have already been delivered and policymakers will bring... 6th July 2022 · 3 mins read
Latin America Economics Update Chile’s economy heading into choppy waters Having defied gravity in 2021, this year is shaping up to be much tougher for Chile’s economy and we think that the economy will contract in both Q3 and Q4. Despite the weakening growth outlook, high... 5th July 2022 · 2 mins read
Latin America Economics Update Goodbye Guzmán, hello crisis The news that Argentine economy minister, Martín Guzmán, resigned over the weekend points to growing influence of the Kirchner faction of the government. From an economic perspective, this is likely... 4th July 2022 · 2 mins read
Emerging Markets Economics Update PMIs: recovery in China but weakness elsewhere The S&P Global EM manufacturing PMI hit its highest level in over a year last month, but that was almost entirely driven by a recovery in China. The surveys softened across most of the rest of the... 1st July 2022 · 2 mins read
Latin America Economics Weekly Ocampo, BanRep hawks & Argentina in crisis (again) Colombian President-elect Gustavo Petro’s choice of José Antonio Ocampo as his finance minister provides an early sign that Petro will govern as an economic moderate. Mr Ocampo will also sit on the... 1st July 2022 · 5 mins read
EM Markets Chart Pack We think EM assets will remain under pressure We expect the yields of emerging market (EM) local-currency (LC) and dollar sovereign bonds to rise further and EM equities to lose more ground as “risk-free” rates continue to climb and global... 30th June 2022 · 8 mins read
Latin America Chart Pack High inflation fuels strikes and protests High inflation seems to be causing growing unrest in the region, which threatens to be economically disruptive and raise fiscal concerns. Recent protests in Ecuador have hit its oil sector hard, while... 28th June 2022 · 14 mins read
Emerging Markets Economics Update A closer look at the surge in EM food inflation Aggregate EM food inflation has risen to its highest rate since 2008 and, while it should fall back in 2023, it’s likely to stay extremely high for at least the next four-to-six months. That will keep... 28th June 2022 · 3 mins read
Latin America Economics Weekly Petro reaction, Lula’s plans, hawkish central banks Gustavo Petro’s win in Colombia’s presidential election has caused tremors in the country’s financial markets. While the appointment of a centrist finance minister could help to settle investors’... 24th June 2022 · 6 mins read
Emerging Markets Economics Update EMs stepping up to support currencies A handful of EM central banks have ramped up FX sales to provide support to weakening currencies over the past couple of months. And with inflation high and the US dollar likely to strengthen further... 24th June 2022 · 3 mins read
Latin America Economics Update Banxico’s tightening cycle shifts up a gear The Mexican central bank’s shift to a 75bp interest rate hike yesterday (to 7.75%) and the hawkish language in the accompanying statement make another 75bp move at the next meeting in August a done... 24th June 2022 · 3 mins read
