A weak first half for growth

After a torrid 2013, financial markets across Latin America have enjoyed a decent run over the first half of 2014, with most equity markets up by around 5% and bond yields edging down too. However, the relative stability in financial markets contrasts with continued weakness in the real economy. We estimate that regional GDP grew by just 2% y/y over the first half of this year – it’s slowest pace since the global financial crisis. What’s more, as things stand, a turnaround in the second half of the year seems unlikely.