Emerging Markets Economics Update EM current account balances: where do the risks lie? With external positions in decent shape in most major EMs, the macroeconomic fallout from any tightening of external financing conditions should be limited. But there are a handful of EMs which look... 2nd September 2021 · 3 mins read
Latin America Data Response Brazil Industrial Production (Jul.) The 1.3% m/m fall in Brazilian industrial production in July confirms that the sector continued its weak performance into the start of Q3, and surveys suggest that August will be weak too. That said... 2nd September 2021 · 2 mins read
Latin America Economics Update Brazil’s drought adds to inflation and fiscal risks Brazil’s drought is getting worse and the impact on hydropower production and electricity tariffs will result in higher inflation than we’d previously thought. Fiscal risks could also intensify if the... 1st September 2021 · 3 mins read
Latin America Data Response Brazil GDP (Q2 2021) Brazil’s GDP contracted by 0.1% q/q in Q2 but, with virus cases falling sharply, it looks like Q3 will be a lot stronger. We doubt that the fall in output last quarter will have much bearing on the... 1st September 2021 · 2 mins read
Latin America Economics Update Chile’s central bank stepping on the brakes The surprise 75bp interest rate hike by Chile’s central bank late on Tuesday (which took the policy rate to 1.50%) underscores policymakers’ concerns about the inflation outlook. Our forecasts for the... 1st September 2021 · 3 mins read
Commodities Weekly Dollar depreciation unlikely to last There was a dramatic turnaround in the fortunes of commodities prices this week, with across-the-board gains as risk appetite picked up and the US dollar eased back. Fed Chair, Jerome Powell, was... 27th August 2021 · 6 mins read
Latin America Economics Weekly Brazil at breaking point, Argentina’s SDRs, Chile pensions Brazil’s institutional crisis took a turn for the worse this week, and points to an environment in which fiscal risks will grow and the economic reform agenda will be put on the backburner. Elsewhere... 27th August 2021 · 7 mins read
EM Markets Chart Pack China’s growth slowdown may hold back EM equities We think slower growth in China will continue to weigh on the country’s stock market, as well as those of some other emerging markets (EMs). 27th August 2021 · 8 mins read
Latin America Economics Update Brazil: could a savings drawdown lift the recovery? We estimate that Brazilian households have ‘excess’ savings worth around 6% of GDP resulting from the pandemic. These should help to cushion consumer spending in the face of headwinds caused by rising... 26th August 2021 · 3 mins read
Emerging Markets Activity Monitor Em. Europe & Lat Am leading the recovery in Q3 Most economies in Emerging Europe and Latin America look set for a strong third quarter and, while the near-term outlook for Southeast Asian economies remains challenging, high-frequency mobility... 25th August 2021 · 3 mins read
Latin America Data Response Brazil IPCA-15 (Aug. 2021) The rise in Brazilian inflation to 9.3% y/y in the middle of August provides Copom with plenty to worry about and will keep it on course to hike the Selic rate by another 100bp (to 6.25%) next month. 25th August 2021 · 2 mins read
Latin America Data Response Mexico Bi-Weekly CPI (August) Mexico’s headline inflation rate dropped to a weaker-than-expected 5.6% y/y in the first half of August, but the further rise in core inflation will continue to concern the central bank. We expect... 24th August 2021 · 2 mins read
Commodities Update A few points to make on extreme weather events Some of our forecasts for commodity prices this year have been blown off course by extreme weather events. As economists we cannot pretend to have insight into future weather patterns, but we can... 23rd August 2021 · 3 mins read
Emerging Markets Trade Monitor EM goods exports may have reached a turning point Having surged over the past year or so, EM exports appear to be peaking as final demand is levelling off and commodity prices are dropping back. That said, exports will likely remain at elevated... 23rd August 2021 · 2 mins read
Latin America Economics Weekly More fiscal worries in Brazil, the regional re-opening Worries about a worsening of Brazil’s fiscal position in the run-up to next year’s general elections have continued to build, and we think there may now be a fiscal risk premium of about 50bp embedded... 20th August 2021 · 5 mins read
Global Markets Update Gains in EM equities may be small from here We don’t expect emerging market (EM) equities, as a whole, to rack up big gains over the next few years thanks in part to the spillovers of lower growth in China. 19th August 2021 · 4 mins read
