Second round simulations shows Jair Bolsonaro technically tied with Ciro Gomes (36% vs 38%, respectively) and Fernando Haddad (39% vs 36%, respectively)
The trade deficit came in at USD 557 million, closer to market consensus (USD 600 million forecast), than our USD 719 million estimate.
Second round scenarios show Jair Bolsonaro improving his voting intentions
Second round simulations shows Jair Bolsonaro technically tied with Fernando Haddad, Marina Silva and Geraldo Alckmin, and losing to Ciro Gomes (38% to 45%)
Compared to the year-earlier period, it rose 1.6%.
Given the poor performance of recent months, the quarterly change slipped back to negative levels after 18 months of gains
Both polls show the same result
Compared to one year ago, core sales declined 1.0% and experienced the first negative reading under this metric in 16 months.
Jair Bolsonaro (PSL) leads the presidential race with 27% of voting intentions, followed by Ciro Gomes (PDT) with 12%.
The poll shows Jair Bolsonaro (PSL) with 26% of voting intentions (from 22% in the previous Ibope poll)
The poll shows Jair Bolsonaro (PSL) with 26% of voting intentions (from 22% in the previous Ibope poll), followed by Ciro Gomes (PDT) with 11% (from 12%)
In this scenario, blanks, nulls and undecided voters dropped to 22% of the electorate, coming from 28% in the previous poll
Overall, inflationary pressures remained controlled, with headline inflation ticking down 0.1pp to 2.6% in Chile.
Our preliminary estimate for the IPCA in September is a 0.40% hike that would push the year-over-year rate up to 4.4%
Year-to-date, the IPCA went up 2.85% and the year-over-year change decelerated to 4.19%.
This is the first poll since the recent decision by the Supreme Electoral Court (TSE) to bar Lula from the election
Our baseline scenario relies on the expectation that trade tensions will ease in the months ahead
Growth in the month was 3.3%, above the Bloomberg market consensus of 2.9% and our 2.5% call.
At current real exchange rate levels, the net public debt will likely end this year at 56% of GDP.
The board is alert to mounting external risks, but remains upbeat with the domestic economic outlook.
The electoral court will give the PT ten days to present a substitute candidate
The treasury will target a primary fiscal deficit of 0% of GDP in 2019.
On a year-over-year basis, GDP growth has been decelerating.
The still turbulent external environment (including uncertainty over reforms in Brazil) is also a key obstacle for stabilization
The court may not review his candidacy tomorrow, but still rule on whether he can or not ask for votes in the television and radio propaganda
The policy rate (the 7-day Leliq, a bill issued by the monetary authority) is now at 60%.
The daily average of new loans rose 0.5% mom/sa in real terms for the non-earmarked segment and increased 2.7% for earmarked loans.
The result reinforces the outlook of weak underlying growth shown by a broad set of economic indicators
The result reinforces the outlook of weak underlying growth shown by a broad set of economic indicators.
Trump said that they will terminate NAFTA deal and replace it with the one agreed with Mexico
The worsening in the current account was accounted by a deterioration in the trade, services, and net income deficit
Over 12 months, the current account deficit widened to USD 15 billion (or 0.8% of GDP).
Our preliminary forecast for the headline IPCA in August is -0.02%
The worsening in the current account was accounted by a deterioration in the trade, services and net income deficits.
The next readings may continue to be negatively influenced by tighter financial conditions and higher economic uncertainty
Year-to-date inflation reached 3.14%, while the year-over-year change decelerated to 4.30%.
The sectorial breakdown show gains in the service and agricultural sectors, while commerce industry receded at the margin.
In the scenario without Lula (PT), Jair Bolsonaro (PSL) leads the presidential race with 20% of voting intentions (coming from 17% in the previous Ibope poll)
The treasury reported a primary deficit of ARS 14.3 billion in July.
GDP increased 5.3% year over year, just above the 5.2% derived from the monthly GDP proxy (Imacec).
Two nationwide polls are expected to be released today
In our view, a successful renegotiation of NAFTA would likely mean an end to the tightening cycle.
The main highlights will come from the political side next week.
The minutes reaffirmed that the board sees current inflationary pressures as transitory (restricted to non-core prices).
The result reflects the normalization on major monthly indicators
The continued narrowing is explained by the energy balance improvement
The result reflects the normalization on major monthly indicators.
In our view, recent measures will only be sufficient to stabilize the peso and other asset prices if strains on external financial markets diminish
The USD 719 million trade deficit in June was smaller than Bloomberg market consensus' of USD 800 million and our USD 917 million forecast.
Our estimate for core retail sales is a 0.5% increase.
The policy rate (the 7-day Leliq, a bill issued by the monetary authority) is now at 45%.
Broad retail sales advanced 2.5% mom/sa, topping the median of market expectations (2.1%) and our call (1.6%).
We expect inflation to decrease to 4.0% by the end of this year
Our preliminary estimate for the IPCA in August is a 0.03% move that would push the year-over-year rate down to 4.32%
Headline inflation came in at 4.81 year-over-year in July, while core inflation remained practically unchanged
Inflation decelerated sharply from 1.26% in June, showing the waning impact of the cargo transportation stoppages and the red mode in the tariff flag system
We do not see room for interest-rate cuts before the market stabilizes more clearly
The rate was set at 40%, the same level of the previous policy rate (center of the 7-day repo corridor).
The annual Imacec (monthly GDP proxy) variation was 4.9%, slightly below Bloomberg market consensus’ (5.3%) and our forecast (5.2%)
The annual Imacec (monthly GDP proxy) variation was 4.9%, slightly below Bloomberg market consensus’ (5.3%) and our forecast (5.2%).
This is the first time that Alckmin leads a poll in the 2018's elections
In our view, a successful renegotiation of NAFTA would likely mean an end to the tightening cycle
The board seems comfortable with the current policy rate level, signaling that under current conditions there is no need for additional cut
We will learn more about the rationale for this decision with the release of the Copom minutes on Tuesday
In the statement, the central bank highlighted that recent upside surprises of inflation were due to transitory factors.
The authorities undertook the usual factual updates, noting the effects of the transportation sector disruption on activity and inflation.
Our forecasts for the average unemployment rate are 12.4% in 2018 and 12.2% in 2019
Keeping this favorable scenario consistently depends strictly on the approval of reforms
The unemployment rate is 0.6 p.p. lower than in June 2017.
The general government’s gross debt went up to 77.2% of GDP in June.
We do not see the board in any haste to modify the policy rate
Over 12 months, the current account deficit widened to USD 13.9 billion (0.7% of GDP)
Compared to our forecasts, revenues came a little lower and expenditures mostly in line the expected.
Over 12 months, the current account deficit widened to $13.9 billion, or 0.7% of GDP.
The deficit was in line with our forecast (USD 400 million) and below market expectations (USD 550 million, according to Bloomberg)
The trade balance showed a deficit of USD 382 million, almost half the amount registered in the same month of last year (USD 750 million).
We see downside risk to our 0.5% growth forecast for this year
Activity dropped by 5.8% YoY in May (vs. market expectations of a 1.3% contraction and our forecast of a 1.0% decline).
The monthly GDP proxy (IGAE) expanded 2.2% year-over-year in May, below our forecast (2.8%) and in line with median market expectations
The monthly GDP proxy (IGAE) expanded 2.2% year-over-year in May, below our forecast (2.8%) and in line with median market expectations.
Our preliminary forecast for the headline IPCA in July is an increase of 0.28%
Regulated prices were behind the biggest deviation from our forecast.
If confirmed, the allieance will take the share of TV and Radio campaign time of the PSDB alliance to almost 50%.
We expect the report to shed light on the monetary policy framework
The nominal deficit (now including the interest bill) fell to 5.3% in June.
The results indicate that voting intentions between the two pre-candidates is broadly unchanged, with Bolsonaro’s lead still at around 3p.p.
Marina Silva’s voting intentions seem to be declining a bit, now at 10%
The result reflects the widespread decline as a result of truckers’ stoppages in the last two weeks of May
CPI rose 3.7% from May to June, slightly above the Bloomberg market consensus forecast of 3.6%.
The result reflects the widespread decline observed in industrial production, retail sales and services real revenues.
The breakdown shows mom/sa declines in 9 out of 12 sectors
The breakdown shows mom/sa declines in 9 out of 12 sectors, with transportation as the highlight.
Eight out of 10 broad retail components posted seasonally-adjusted monthly drops in May
The dynamics has been heavily affected by the truckers’ stoppage between May 21-29
Broad retail sales dropped 4.9% mom/sa, missing the median of market expectations and our call (both at -3.2%).
The dynamics has been heavily affected by the truckers’ stoppage between May 21-29.
We do not see room for interest-rate cuts before the market stabilizes more clearly
The strong growth suggests some payback from the weakness in May.
The decision was in line with comments by some board members prior to the meeting that pointed to the limited room for additional rate cuts
The consumer price index IPCA climbed 1.26% in June, below our estimate (1.35%) and near the median of market expectations (1.28%)
The sharp decline was caused by the trucker’ stoppage, which affected supply and production chains in the final two weeks of the month
The minutes suggest the next decision is more open
Compared to May 2017, the indicator was down by 6.7%
Over 12 months, the trade surplus shrank to $61 billion
The median GDP growth expectations remained stable for 2018 after eight consecutive weekly declines
The result came in below our estimate ($6.2 billion) and market’s consensus ($6.6 billion)
Andrés Manuel López Obrador (AMLO) won Mexico’s presidential elections
The anti-establishment candidate Andrés Manuel López Obrador (AMLO) won Mexico’s presidential elections
The level of blank/null/undecided voters is significantly higher
In its fourth monetary policy meeting of the year, the central bank of Colombia kept the monetary policy rate at 4.25
We continue to believe that the government will meet its primary-deficit target for the year (2.2% of GDP or BRL 161 billion).
The daily average of new non-earmarked loans declined 1.0% mom/sa in real terms and delinquency fell 0.1 p.p. to 3.2%
Overall seasonally-adjusted delinquency fell 0.1 p.p. to 3.2%.
The National Monetary Council (CMN) announced that the inflation target for 2021 is 3.75
Over 12 months, the current account deficit widened to USD 13 billion or 0.65% of GDP.
The number is down from 4.5% this year, 4.25% in 2019 and 4.0% in 2020.
After a robust performance in 1Q18, the economy weakened somewhat in April.
Over 12 months, the current account deficit widened to USD 13 billion or 0.65% of GDP.
The apparently high print, nevertheless, is inflated by a big calendar effect.
Mexico’s central bank increased its policy rate by 25-bps as expected by us and the majority of market analysts
In justifying the decision, the central bank mentioned a deterioration of the balance of risks for inflation.
In the reference scenario, which assumes stable Selic and FX rate, inflation forecasts are set at 4.2% in 2018 and 4.1% in 2019.
Growth was consistent with market expectations (according to the Bloomberg survey) and with the official monthly GDP proxy (EMAE).
In the reference scenario, which assumes stable Selic and FX rate, inflation forecasts are set at 4.2% in 2018 and 4.1% in 2019.
Lower GDP and higher inflation is expected in Brazil according do the Focus survey
Growth was consistent with market expectations (according to the Bloomberg survey) and with the official monthly GDP proxy (EMAE).
Former president Uribe’s backed Duque, who will take office on August 7, will have to deal with a manifold of challenges.
Ivan Duque won the presidential election in Colombia
Since the Copom meeting in May, the scenario has become increasingly challenging.
The relatively low headline inflation was favored by regulated prices, which increased by only 0.4% MoM.
Nine out of 10 broad retail components posted seasonally-adjusted monthly increases in April.
The relatively low headline inflation was favored by regulated prices, which increased by only 0.4% MoM.
Nine out of 10 broad retail components posted seasonally-adjusted monthly increases in April.
A rate hike is not completely off the table in the near term.
In April, seasonally-adjusted industrial production fell 0.4% from the previous month.
A rate hike is not completely off the table in the near term.
The Datafolha poll was undertaken after the truck drivers stoppage and shows no major change relative to earlier surveys.
In April, seasonally-adjusted industrial production fell 0.4% from the previous month.
The year-over-year change accelerated to 2.86% from 2.76% in April.
According to the BCB governor, Ilan Goldfajn, the central bank will step up interventions in the FX market to reduce volatility
Weak result in May’s auto production following truck drivers’ strike
According to the BCB governor, Ilan Goldfajn, the central bank will step up interventions in the FX market to reduce volatility
Following significant BRL depreciation Brazilian Central Bank intervenes in FX markets
In yoy terms, auto production receded 15.3%.
Analysts revised their inflation expectations markedly upward after the sharp weakening of the peso last month
The currency finished the day valued at BRL 3.81/USD.
Pundits forecast GDP to grow 1.3% in 2018 and 2.2% in 2019 in Argentina
In our view, risks have intensified recently.
GDP expanded 0.4% qoq/sa in 1Q18, slightly better than market expectations (0.3%)
In our view, risks have intensified recently.
The central government posted a BRL 7.2 billion primary surplus in April, better than market expectations
Year-over-year growth reached 1.2%, printing between the median of market estimates (1.3%) and our call (1.0%).
In the scenario without Lula, Bolsonaro’s voting intentions increased to 19% from 16% a month ago.
The surprise came from higher net-revenues, especially those from oil royalties.
President Temer announced additional measures aimed at ending the strikes
Diesel prices will be cut by 0.46 BRL / liter, with a BRL 13.5 billion fiscal cost until year-end.
Yesterday, the government announced several measures aimed at ending the truck-drivers’ strike
The government will reduce the CIDE tax on fuels to zero until year-end, with a decline in tax collection of around BRL 1.5 billion.
The net negative fiscal impact for this year will be of around BRL 10 billion.
The Lower house approved yesterday a reduction in the PIS/Cofins tax to zero, with negative fiscal impact
Year-to-date inflation reached 1.23%, while the year-over-year change slid to 2.70% from 2.80% in April.
Argentine Central Bank kept the benchmark interest rate (7-day repo rate) unchanged at 40%
IPCA inflation expectations increased for 2018 to 3.50% (from 3.45%)
The central bank expects core inflation to remain at high levels in May, given its high-frequency indicators (2.1% mom in April).
IPCA inflation expectations increased for 2018 to 3.50% (from 3.45%).
Chile’s GDP was strong in the first quarter of 2018, both at the margin and on annual basis
The economy increased 4.2% year over year, above expectations of 4.0% derived from the monthly GDP proxy (Imacec).
In Mexico, the central bank decided to leave the policy rate unchanged at 7.5%
The central bank still sees the current policy stance as consistent with inflation convergence.
The Copom decided to end the cycle leaving the base rate unchanged at 6.5% pa
The new NSA GDP series grew 2.2% year over year in 1Q18, after the 1.8% in 4Q17.
The external scenario is no longer described as favorable by the Copom but, instead, as more challenging and more volatile.
The new NSA GDP series grew 2.2% year over year in 1Q18, after the 1.8% in 4Q17.
The median GDP growth expectations for 2018 declined 19 bps to 2.51%, and remained flat for 2019 and 2020
IPCA inflation expectations declined once again for 2018 to 3.45% (from 3.49%).
Brazil's core retail sales increased 0.3% mom/sa in March, above the median of market expectations (0.2%) and our estimate (0.1%), maintaining upward trend
The index had risen 0.09% in the previous month and 0.14% in April 2017.
Compared to March 2017, core sales expanded 6.5%.
The index had risen 0.09% in the previous month and 0.14% in April 2017.
Mexico's CPI came in below market expectations for the third consecutive month
The CPI posted a monthly deflation rate of 0.34% – undershooting our forecast and median market expectations (both -0.31%, as per Bloomberg).
Argentina's central bank reaffirmed tight monetary stance and floating exchange regime. Treasury goes to the IMF
The announcements are part of the government’s effort to contain market deterioration.
The Chilean recovery advanced in the first quarter of 2018
The 4.0% growth rate recorded in the quarter (2.5% in 4Q17) is the highest since 3Q13.
Argentina´s central bank hiked the reference rate (7-day repo) by 675 bps to 40% in a new inter-meeting decision
The decision followed a 300-bp hike last week
This is the third time in a week that the monetary authority decides to tighten monetary conditions to cope with a run on the peso.
The decision followed a 300-bp hike last week.
The Central Bank just announced that it will start today the rollover of FX swap contracts expiring in June 1st
In spite of tight macro policies and the uncertainties associated to NAFTA, Mexico’s GDP accelerated in 1Q18
If this pace is maintained throughout the month the BCB will auction USD 2.8 billion more than the amount expiring in June (USD 5.7 billion).
The central bank increased its policy rate (7-day repo) by 300-bps in an inter-meeting decision, to 30.25%
The flash estimate of GDP growth for 1Q18 came in at 1.2% year-over-year, closer to our forecast than to median market expectations.
Considering the rate increase already implemented, we think CPI data will play a less important role over the next few decisions.
In fact, the majority of board members see the current policy stance as consistent with the convergence of inflation to the target.
In fact, the majority of board members see the current policy stance as consistent with the convergence of inflation to the target.
The central government posted a BRL 24.8 billion primary deficit in March, worse than market expectations
The central bank kept the benchmark interest rate (7-day repo rate) unchanged at 27.25% at its second monetary policy meeting in April
The surprise came from lower revenues, especially from oil royalties, and higher mandatory and discretionary expenditures.