Mexico Delivers Second Straight Rate Hike on High Inflation Yet Nikhil Sanghani, a Latin America economist at Capital Economics, said that threat would have to damage expectations in a significant way for the central bank to change course. “It’s still a bit... 12th August 2021 · Bloomberg
Latin America Data Response Mexico Industrial Production (Jun.) The surprise 0.5% m/m fall in Mexico’s industrial production in June was driven by broad-based declines across sectors, including further disruption to auto production. Industry probably continued to... 11th August 2021 · 2 mins read
Latin America Data Response Brazil IPCA (Jul.) The further rise in Brazil’s headline inflation to 9.0% y/y in July will add to the central bank’s concerns over the inflation outlook. We think that its aggressive tightening cycle has much further... 10th August 2021 · 2 mins read
Latin America Data Response Mexico Consumer Prices (Jul.) Despite the small fall in Mexico’s headline inflation rate to 5.8% y/y in July, core inflation rose further to 4.7% y/y on the back of higher services inflation. This strong inflation reading will... 9th August 2021 · 2 mins read
Latin America Economics Chile GDP, central bank hawks, Brazil’s meteor This week’s strong activity data from Chile reaffirms our long-held optimism over its economic recovery, and will probably cause the central bank to adopt a more hawkish stance. Other central banks in... 6th August 2021 · 7 mins read
Latin America Economics Focus The economic fallout from political risks in Lat Am The pandemic appears to be accelerating a political trend towards populism in Latin America. While there is a lot of uncertainty about how this might play out, it generally points towards loose fiscal... 5th August 2021 · 15 mins read
Latin America Economics Weekly Worrying signs from Castillo, regional re-opening The first steps from Peru’s newly-inaugurated President, Pedro Castillo, provide plenty of worrying signs for investors and suggest that local financial markets will remain on the back foot. Meanwhile... 30th July 2021 · 6 mins read
Peru’s President Puts Himself On a Path To Nowhere As Nikhil Sanghani of Capital Economics pointed out to me, the lack of a clear and coherent plan is particularly alarming when we know that the countries which have fared best over these tumultuous... 29th July 2021 · Bloomberg
Latin America Economics Weekly Mexico’s Delta despairs, Bolsonaro’s giveaways The third virus wave currently underway in Mexico, driven by the contagious Delta variant, will probably weigh on activity this quarter. But, for now, we don’t think that it will derail the economic... 23rd July 2021 · 6 mins read
Latin America Data Response Mexico Bi-Weekly CPI (Jul.) The small fall in Mexico’s headline inflation to 5.8% y/y in the first half of July was mainly due to fuel inflation dropping back, while the core rate remained stubbornly high at 4.6% y/y. The... 22nd July 2021 · 2 mins read
Latin America Economic Outlook Not all doom and gloom Virus outbreaks are easing in much of Latin America which should support activity in the near term. And while vaccination coverage is still weak in most of the region, suggesting there is still a... 19th July 2021 · 26 mins read
Latin America Economics Chile: start of a long but gradual tightening cycle Chile’s central bank fired the starting gun on a gradual tightening cycle yesterday as it hiked its policy rate by 25bp, to 0.75%. While it signalled that monetary policy will remain accommodative... 15th July 2021 · 3 mins read
Latin America Data Response Mexico Industrial Production (May) The small 0.1% m/m gain in Mexico’s industrial production in May came despite a concerning 0.7% m/m drop in manufacturing production as shortages continued to hamper the auto sector. While there are... 12th July 2021 · 2 mins read
Latin America Economics Unpacking Banxico’s minutes, Sinovac success? The fairly hawkish minutes to Banxico's last meeting, where it delivered a surprise 25bp hike, reaffirm our initial view that more tightening is in the pipeline. We now expect a further 125bp of hikes... 9th July 2021 · 5 mins read
Latin America Data Response Mexico Consumer Prices (Jun.) The rise in Mexico’s core inflation to 4.6% y/y in June was largely driven by temporary factors which will gradually unwind. Nonetheless, given Banxico’s recent hawkish shift, and with headline and... 8th July 2021 · 2 mins read
Latin America Economics Weekly Fallen angel and a rising star Colombia’s second sovereign ratings downgrade to junk status was already largely priced in to local financial markets, but they could come under renewed pressure as public debt risks intensify over... 2nd July 2021 · 6 mins read
