Figures out this week underscored the strength of inflation in Brazil, but we think the weakness in the latest economic activity might just be enough to prompt Copom to make the 100bp hike (to 14.25%) in the Selic rate at next week's meeting the last in the cycle. Elsewhere, Argentina’s government is inching towards another IMF deal which will help President Milei’s stabilisation agenda. That said, with the mid-term elections approaching, it's unlikely that he will move quickly to lift capital controls and allow the peso to move to more sustainable levels. We’re hosting an online briefing on Wednesday to discuss Argentina’s challenges in more detail. Sign up here.
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