Latin America Economics Update Strength in exports unlikely to last The surge in exports from Latin America’s major economies in March suggests that the upside risks to our GDP growth and currency forecasts are building. But with advanced economies poised to fall into... 3rd May 2023 · 3 mins read
Latin America Economics Update Colombia: political risks back in the spotlight The replacement of Colombia’s market-friendly finance minister José Antonio Ocampo with a close ally of President Petro is likely to lead to a sell-off in Colombia’s financial assets when markets open... 27th April 2023 · 3 mins read
Latin America Economics Update Can Chile’s private sector cope with higher interest rates? There’s little evidence (so far) that the surge in interest rate is leading to widespread debt servicing problems in Chile’s private sector, but there are pockets of vulnerability in the household... 25th April 2023 · 4 mins read
Latin America Economics Update Chile’s central bank: still focused on inflation risks The Monetary Policy Report released by Chile’s central bank today revealed that policymakers are more concerned about inflation risks than we’d thought. We still think that Chile’s central bank will... 5th April 2023 · 3 mins read
Latin America Economics Update Drought to push Argentina’s economy into deep recession The historic drought afflicting Argentina will cause a steeper contraction in GDP than most expect this year and intensify balance of payments strains by reducing export earnings to the tune of 2-3%... 5th April 2023 · 3 mins read
Latin America Economics Update Banxico & BanRep close to but not at the end of their cycles Central banks in Mexico and Colombia both delivered 25bp hikes yesterday, and hinted that these could be the end of their cycles. But, on balance, we think that the strength of inflation will prompt... 31st March 2023 · 3 mins read
Latin America Economics Update Brazil’s new fiscal plans: yet to convince The new fiscal rule proposed today by Brazil’s finance minister would, if implemented in full, go some way towards stabilising the public debt ratio. But the government has a lot to do convince... 30th March 2023 · 3 mins read
Latin America Economics Update Brazil: Copom sticks to its guns The statement accompanying the Brazilian central bank’s decision to keep the Selic rate unchanged at 13.75% yesterday will have disappointed some (not least in the government) that thought global... 23rd March 2023 · 3 mins read
Global Economics Update What next after Credit Suisse? While the Credit Suisse rescue might draw a line under that particular institution’s problems, it is clear that confidence in the financial sector overall is still extremely fragile. So regardless of... 20th March 2023 · 5 mins read
Emerging Markets Economics Update A closer look at EMs’ exposure to bank flows A key channel through which emerging markets could be affected by the strains in the global banking sector is if lending by foreign banks falls sharply. On this front, EMs’ vulnerabilities have eased... 16th March 2023 · 3 mins read
Latin America Economics Update “Malbec dollar” won’t save Argentina from devaluation A preferential rate to facilitate wine exports is the latest addition to Argentina’s myriad exchange rates, but it doesn’t address the fundamental problem that the peso is overvalued. We estimate that... 15th March 2023 · 5 mins read
Emerging Markets Economics Update The SVB collapse & contagion risks in EMs At the time of writing, financial markets appear to be stabilising after the turmoil caused by the collapse of SVB. And it doesn’t look like EMs have suffered large capital outflows or strains in... 14th March 2023 · 5 mins read
Latin America Economics Update Mexico: strong wage growth to curb fall in inflation Headline inflation in Mexico will continue to fall back over next couple of years, but strong wage growth means that it won’t return to Banxico’s 2-4% tolerance band until late-2024. Against that... 8th March 2023 · 6 mins read
FX Markets Update The Colombian peso looks poised for a rebound As political risks appear to be largely discounted by investors, we expect the Colombian peso to outperform other major EM currencies over the next couple of years. In view of the wider interest we... 2nd March 2023 · 4 mins read
Latin America Economics Update Brazil: is a corporate debt crisis brewing? The dramatic rise in borrowing costs in Brazil in the past few years appears to be causing debt problems at a growing number of companies. So far at least, there is little evidence of widespread... 28th February 2023 · 4 mins read
FX Markets Update We expect the Mexican peso to reverse course before long The Mexican peso’s outperformance since the start of 2022 has pushed up its valuation substantially, and we think that this leaves it vulnerable to sharp falls against the US dollar if, as we expect... 16th February 2023 · 4 mins read
