Latin America Economics Weekly Argentina’s PASO surprise, Pemex debt The loss for Argentina’s ruling Peronists in the open primary (PASO) for mid-term legislative elections in November suggest that the political tides might be shifting and boosted local financial... 17th September 2021 · 6 mins read
Latin America Economics Update Is high inflation here to stay in Latin America? Following a surge in inflation across the region this year, we think that headline rates are at, or close to, a peak in major Latin American economies. But strong underlying price pressures will... 15th September 2021 · 4 mins read
Emerging Markets Economics Update Emerging Markets Capital Flows Monitor Net capital outflows from emerging markets appear to have eased over the past month, helped by a pickup in portfolio flows into South East Asia and India. Looking ahead, even if rising US Treasury... 15th September 2021 · 2 mins read
Asset Allocation Update Putting risky asset valuations into context This Update compares the valuations of the twelve different “risky” asset classes that we cover on our Asset Allocation service, both relative to one another and to the yields of “safe” assets, as... 13th September 2021 · 5 mins read
Emerging Markets Economics Update EM financial conditions still loose barring LatAm Our financial conditions indices show that conditions remain loose by historic standards in most EMs. The key exception is Latin America, where conditions have tightened sharply this year due to... 13th September 2021 · 2 mins read
FX Markets Weekly Wrap Dollar rebound looks unconvincing After weakening over the preceding two weeks, the US dollar has rebounded against most other currencies this week. Nonetheless, last week’s disappointing payrolls report and the slightly less upbeat... 10th September 2021 · 9 mins read
Latin America Economics Weekly Brazil’s political crisis, Mexico’s austere budget It’s been a rollercoaster week in Brazilian politics and financial markets and, while investors have breathed a small sigh of relief in the past day or so, we think that they will be put under further... 10th September 2021 · 5 mins read
Latin America Data Response Mexico Industrial Production (Jul.) The stronger-than-expected 1.1% m/m rise in Mexico’s industrial production in July provides some encouragement that the economy fared well despite the onset of a third virus wave earlier this quarter... 10th September 2021 · 2 mins read
Latin America Economics Update Peru: BCRP stepping up pace of tightening Yesterday’s larger 50bp rate hike, to 1.00%, delivered by Peru’s central bank (BCRP) suggests it is becoming increasingly concerned about the inflation outlook. With inflation set to stay above the 1... 10th September 2021 · 3 mins read
Emerging Markets Economics Focus The pandemic and EM scarring risks The pandemic is likely to inflict lasting damage on potential growth in economies in much of Latin America, Africa and South and Southeast Asia, adding to the structural headwinds that they already... 9th September 2021 · 17 mins read
Latin America Data Response Brazil IPCA (Aug.) The rise in Brazil’s headline inflation rate to 9.7% y/y last month was driven by a broad-based strengthening of price pressures. With the economy re-opening and electricity tariffs hiked this month... 9th September 2021 · 2 mins read
Latin America Data Response Mexico Consumer Prices (Aug.) The drop in Mexico’s headline inflation rate to 5.6% y/y in August masks a further rise in core inflation, to 4.8% y/y, which will be a concern for the central bank. This suggests that its gradual... 9th September 2021 · 2 mins read
Emerging Markets Financial Risk Monitor Evergrande & frontier sovereign debt risks build The combination of large foreign-currency debt burdens, low FX reserves and weakening currencies means that the risk of sovereign defaults in Sri Lanka and Tunisia is growing. Elsewhere, China’s... 9th September 2021 · 6 mins read
Latin America Data Response Chile Consumer Prices (Aug.) The further rise in Chile’s inflation to 4.8% y/y in August suggests that the central bank’s tightening cycle has a lot further to run. We expect a further 100bp of rate hikes, to 2.50%, by end-2021... 8th September 2021 · 2 mins read
Latin America Economics Weekly Brazil’s recovery worries, hawks fly in Chile The disappointing economic data out of Brazil this week has cast some clouds over the economy’s recovery prospects. As it happens, we think that GDP growth will pick up quite strongly in Q3, but we’re... 3rd September 2021 · 7 mins read
Asset Allocation Update EM assets & the risk of higher inflation We think that there is a risk of a period of moderately higher inflation in some major emerging markets (EMs) over the coming years. If that came to pass, it would probably be bad news for local... 3rd September 2021 · 4 mins read
