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Pricing Amlo risk, Brazil’s GDP quirk

Mexican President Andres Manuel Lopez Obrador’s announcement that he will postpone oil auctions adds to a series of populist moves that have rattled local markets, and we reckon this has resulted in a political risk premium of 40-50bp on sovereign debt. Meanwhile, the pick-up in Brazilian investment growth in Q3 was helped by an accounting quirk, but there are still signs that underlying investment is (finally) rising.

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