Emerging Markets Economics Update Inflation expectations fall, but reasons for caution Our dataset on inflation expectations across EMs shows some encouraging falls since 2022 and supports our view that, with EM inflation likely to fall further, monetary easing cycles will start in the... 19th April 2023 · 5 mins read
Latin America Economics Weekly Argentina-IMF trouble ahead, Andean central banks A read between the lines of the IMF’s Fourth Review of Argentina’s $44bn Extended Fund Facility suggests that the deal could be starting to fray at the seams. Meanwhile, the latest messaging from... 6th April 2023 · 8 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 Economic Outlook High inflation will limit room for interest rate cuts GDP growth in Latin America will be among the weakest of any EM region this year and next, and is likely to disappoint consensus expectations. Persistently high inflation has prompted us to push back... 30th March 2023 · 3 mins read
Latin America Economics Weekly Banking turmoil spillovers, Argentina’s IMF loan Latin America's direct exposure to SVB and Credit Suisse is limited, but the turmoil is still likely to have indirect effects on the region. To the extent that growth in the US is weaker, Mexican... 17th March 2023 · 8 mins read
Emerging Markets Economics Update EM slowdowns and NPLs: lessons from the past Non-performing loan (NPL) ratios have risen by as much as 4-5%-pts during non-banking crisis downturns in EMs in the past. This time around, there are reasons to think that the increase will be... 6th March 2023 · 5 mins read
Latin America Economics Weekly Wage pressures, Mexico’s Tesla plant Labour market data released across the region this week flew under the radar, but the figures provide worrying signs that rapid wage growth in Brazil will continue to keep core inflation high. We take... 3rd March 2023 · 7 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 Chart Pack External vulnerabilities to ease as growth weakens The latest data suggest that current account deficits in the region’s major economies narrowed towards the end of last year, which is particularly good news for Colombia and Chile. Both were running... 22nd February 2023 · 15 mins read
Emerging Markets Economics Update EM investment: weak outlook and clear divergence EM investment surged far above pre-pandemic levels last year, but there was a clear divergence across countries and we think investment growth will slow in 2023. One worrying development is that... 20th February 2023 · 4 mins read
Latin America Economics Weekly Petro spooks investors (once again), Brazil’s fiscal rule In Colombia, President Petro’s healthcare reform unveiled this week reinforces our concerns about a worsening public debt trajectory and more interventionist policymaking, and caused the peso to fall... 17th February 2023 · 6 mins read
Latin America Data Response Colombia GDP (Q4) The stronger-than-expected 0.7% q/q expansion in Colombia’s GDP in Q4 confirms that the economy was a regional outperformer over 2022 as a whole. But the expenditure breakdown suggests that the... 15th February 2023 · 2 mins read
Latin America Economics Weekly Weak survey data, inflation concerns, rate forecasts The batch of survey data for January released this made for pretty depressing reading and reinforces our view that, despite the boost from commodities, regional growth will slow sharply this year... 3rd February 2023 · 7 mins read
Emerging Markets Economics Update EM banks well placed to face rising loan losses EM banks will face an increase in loan losses this year, but the good news is that banking sectors on the whole appear well-placed to absorb these, particularly in parts of Latin America, Emerging... 2nd February 2023 · 4 mins read
Latin America Economics Update Colombia: end of tightening cycle approaching The minutes to the Colombian central bank meeting last Friday revealed that worries about the growth outlook will bring the tightening cycle to a close soon. We expect the central bank to deliver one... 1st February 2023 · 3 mins read
Latin America Economics Weekly Lula’s first presidential (mis)steps, Colombian inflation The first speeches and actions by Brazil’s president Lula after his inauguration earlier this week reinforce our view that his presidential term will be characterised by higher public spending and a... 6th January 2023 · 5 mins read
