All inflation targeting economies in Latin America expanded in Q3, and growth looks set to continue at a decent pace over the next few quarters. As a result, we expect a modest rate hikes to begin in Q2 next year. But the pace of tightening will be slowed initially by concerns over strong exchange rates and speculative inflows of capital, and then by a slowdown in the pace of growth in the second half of 2010. Brazil is likely to lead the way, with the first hike possible in April, while Chile will be amongst the last to tighten monetary policy as concerns over deflation linger. Meanwhile, we continue to expect Mexico to remain on hold throughout 2010.