Concerns about rising inflation in Brazil are growing, we don’t think these fears are a bit overblown; underlying prices pressures remain soft. This is likely to remain the case, suggesting the central bank is unlikely to tighten policy as soon as most expect. Elsewhere, Mexico’s state-owned oil company, Pemex, posted a rare operating profit in Q3 though the company’s finances are still in dire straits. Finally, investors have shrugged off Chileans’ vote to rewrite its constitution, but we think that the changing political and economic landscape will weigh on the country’s sovereign bonds and currency.
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