Copom’s botched communications, CLP selloff

The mixed messages between the statement and the minutes to Brazil's central bank meeting earlier this month seem to be a reflection of divisions on Copom between hawks and doves. We think the more hawkish members are likely to be vindicated and expect the easing cycle to proceed more gradually than most currently anticipate. Elsewhere, the Chilean peso has come under pressure in recent weeks and, while the currency may continue to struggle over the remainder of this year, we think there’s scope for the peso to outperform other Latin American currencies in 2024.