Latin America Economics Update What next for Brazil’s recovery? The hit to the Brazilian economy from May’s truck drivers’ strike already seems to be reversing. But the recent tightening of financial conditions means the recovery over the second half of the year... 13th July 2018 · 1 min read
Latin America Data Response Brazil Consumer Prices (Jun.) The jump in Brazilian inflation last month, to 4.4% y/y, from 2.9% y/y in May appears to be a result entirely of the truck drivers’ strike and electricity price hikes, and there are already signs that... 6th July 2018 · 1 min read
Latin America Data Response Brazil Industrial Production (May) The 10.9% m/m fall in Brazilian industrial production in May suggests that the truck drivers’ strike at the end of that month may have knocked about 0.4-0.6%-pts off q/q GDP growth in the second... 4th July 2018 · 1 min read
Latin America Economics Update Financial conditions tighten in key economies Argentina’s currency crisis has caused financial conditions there to tighten sharply in the past few months, and this is one reason why we expect the economy to fall into recession in the coming... 3rd July 2018 · 1 min read
Latin America Economics Weekly BCB plays down rate hikes, Mexico goes to the polls A victory for left-wing populist Andres Manuel Lopez Obrador (Amlo) in Mexico’s presidential vote this weekend looks priced in. The market reaction is likely to take its cue from the performance of... 29th June 2018 · 1 min read
Latin America Economics Weekly Central banks take centre stage The Mexican central bank’s decision to raise interest rates this week underscored its sensitivity to currency weakness and, while our base case is that this move will be a one-off, further falls in... 22nd June 2018 · 1 min read
Latin America Economics Update FX sell-off to trigger hike in Mexico, but Brazil to hold The latest sell-off in the Mexican peso tips the balance towards policy being tightened at Thursday’s central bank meeting. We’re changing our forecast and now expect a 50bp hike in the policy... 19th June 2018 · 1 min read
Latin America Economics Focus Assessing Lat Am’s vulnerability to US protectionism Mexico, as well as several smaller countries in Central America (including Nicaragua, Honduras and Costa Rica), are most vulnerable to a general escalation in US protectionism. But individual sectors... 13th June 2018 · 1 min read
Latin America Data Response Brazil Consumer Prices (May) Brazilian inflation ticked up from 2.8% y/y in April to 2.9% in May, due in part to the recent truck drivers’ strike, which has led to supply disruptions. And while the markets have responded to the... 8th June 2018 · 1 min read
Latin America Economics Update Brazil: Real’s fate now lies with political developments The fall in the real over the past couple of months means that, judged on macroeconomic fundamentals at least, the currency no longer looks overvalued. The big risk over the next six months is that... 6th June 2018 · 1 min read
Latin America Data Response Brazil Industrial Production (Apr.) The larger-than-expected 0.8% m/m rise in Brazilian industrial production is encouraging given the sector’s weak showing in Q1. But the trucker’s strike that paralysed the country for nine days last... 5th June 2018 · 1 min read
Global Central Bank Watch Geopolitics more likely to affect ECB than the Fed For now, we don’t expect the geopolitical developments to alter the behaviour of the major central banks. Provided that the political crisis in Italy does not flare up again, we think the ECB is... 1st June 2018 · 1 min read
Latin America Economics Update Brazil truckers’ strike: no cause for alarm bells just yet The truck drivers’ strike that has paralysed large swathes of Brazil’s economy over the past nine days has generated some apocalyptic headlines and led many forecasters to slash their 2018 GDP growth... 30th May 2018 · 1 min read
Latin America Data Response Brazil GDP (Q1) The 0.4% q/q rise in Brazilian GDP in Q1 was modest but will go some way to allaying concerns that the economic recovery has stalled altogether. The truck drivers’ strike that has gripped parts of the... 30th May 2018 · 1 min read
Latin America Economics Update Why has Brazilian inflation stayed so low? The recent weakness of Brazilian inflation appears to be due in part to persistently weak food inflation, but more importantly it looks like the large output gap in the economy has dragged down core... 11th May 2018 · 1 min read
Latin America Data Response Brazil Consumer Prices (Apr.) Brazilian inflation ticked up to 2.8% y/y in April, but underlying price pressures are still subdued. Taking that together with softer economic activity figures, we think COPOM will cut the Selic rate... 10th May 2018 · 1 min read
