The administration and Congress reached an agreement regarding the 2021 budget
Recovering domestic demand is restraining the pace of the trade correction
Retail confidence continued to surge, while industrial sentiment moderated somewhat
The initiative received support from 120 legislators, surpassing the 90 vote threshold (3/5).
Retail confidence continued to surge, while industrial sentiment moderated somewhat
We forecast a fiscal deficit of 4.0% of GDP, down from 6.2% in 2020
The approval of a structural tax reform is a key prerequisite for credit rating agencies to maintain Colombia’s investment grade rating
We forecast a fiscal deficit of 4.0% of GDP, down from 6.2% in 2020
Results for the second round are highly uncertain
Retail sales will probably decline strongly in March
Results for the runoff are highly uncertain
Inflationary pressures remain contained amid significant slack in the economy
IPCA rises 0.93% in March pressured by vehicle fuels
Inflationary pressures remain contained amid significant slack in the economy
The benign external environment would be partially countered by improving domestic demand and higher oil prices
The full trade balance result will be released on April 19
The benign external environment would be partially countered by improving domestic demand and higher oil prices
Overall, we expect a broadly stable current account deficit this year at a wide 3.4% of GDP
We expect inflation to rebound to 2.8% this year from 1.61% in 2020
We forecast inflation at 7.0% this year, down from 9.4% in 2020
We expect a 0.54% MoM variation (similar to last year), driven by fuels, rentals and food prices
Employment continues to recover, led by informal jobs.
Industrial production fell 0.7% mom/sa in February, disappointing both market expectations (+0.5%) and our call (+0.2%).
Employment continues to recover, led by informal jobs.
As widely expected, the central bank of Chile left the policy rate unchanged at its March meeting, at the technical minimum of 0.5%.
The administration announced yesterday several ministerial changes.
The central bank is downplaying market expectations of rate hikes later this year.
Our baseline scenario considers stable rates at 1.75% for this year, but risks lean to an earlier lift-off
The administration announced several ministerial changes
We expect Banxico to keep unchanged its policy rate at 4.00% this year
Our baseline scenario considers stable rates at 1.75% for this year, but risks lean to an earlier lift-off
We expect Banxico to keep unchanged its policy rate at 4.00% this year
Energy prices exerted upward pressure
Energy prices exerted upward pressure
We forecast GDP growth of 6.0% for 2021
We forecast GDP growth of 6.0% for 2021
The government announced additional support measures worth USD 6.2 billion (2% of GDP)
We expect GDP to grow 6.0% in 2021, supported by external demand (a solid recovery in the U.S. economy)
Tax collection increased in real terms in the quarter ended in February, led by higher export taxes
External demand is the main driver of the recovery
Drivers for growth are positive, but new lockdowns and the fading effect from pension withdrawals will be short-term drags ahead.
Drivers for growth are positive, but new lockdowns and the fading effect from pension withdrawals will be short-term drags ahead
The Copom decided to hike the Selic rate by 75bps and signaled the intention to repeat the current pace in the next policy meeting
Seasonally-adjusted CAGED formal job creation reached 227k, down from +331k in the previous month.
The Copom decided to hike the Selic rate by 75bps and signaled the intention to repeat the current pace in the next policy meeting
We expect the Colombian economy to rebound this year, with growth of 5.0% (-6.8% in 2020).
Seasonally-adjusted CAGED formal job creation reached 227k, down from +331k in the previous month
We forecast positive GDP growth in 1Q21, despite already accounting for a strong drop of services consumption in March due to social isolation
We expect the Colombian economy to rebound this year, with growth of 5.0% (-6.8% in 2020).
We forecast positive GDP growth in 1Q21
The bill will now head to promulgation
The second-round is scheduled to be voted today
The base text has already been successfully voted, and now the House is discussing proposed amendments to it
The voting on the amendments to the bill and the second-round vote will likely be held today
Once concluded the voting on the amendments, the Lower House will then proceed to the second-round vote
If the decision is upheld, former-President Lula would be allowed to run for the presidential election of 2022
We estimate positive GDP growth in 1Q21 even taking into account a strong decline of the service sector in March
If the decision is upheld, former-President Lula would be allowed to run for the presidential election of 2022
We forecast positive GDP growth in 1Q21
The bill will now head to the lower house, where it needs 3/5 of the house votes for approval
Rising production of capital goods
The proposal will now head to the Lower House to a two-round vote process, likely starting next week, according to the news
Significant recovery in 2H20
Significant recovery in 2H20
The rapporteur for the bill, Senator Marcio Bittar, will maintain the enactment of the spending cap triggers in the proposal
The administration issued a decree reducing to zero the PIS/Cofins taxes on diesel fuel (for two months) and cooking gas (permanently)
The rapporteur for the bill, Senator Marcio Bittar, will maintain the enactment of the spending cap triggers in the proposal
The ongoing recovery in the participation rate, however, will prevent unemployment rate from dropping significantly during 2021
We expect inflation for yearend 2021 at 2.5% pressured mainly by higher food and energy prices
The ongoing recovery in the participation rate, however, will prevent unemployment rate from dropping significantly during 2021
We now expect only one additional 25-bp interest rate cut (March), compared with two rate cuts of the same magnitude in our previous scenario
Our preliminary forecast for the headline IPCA in February is 0.67%
We now expect only one additional 25-bp interest rate cut (March)
The bill limits the legal framework for extra-cap expenditures to the emergency aid and regulates the automatic adjustment mechanisms
Our preliminary forecast for the headline IPCA in February is 0.67%
We forecast a reduction in the primary fiscal deficit to 4.5% of GDP this year
The COPOM kept the monetary policy rate unchanged at 0.75%, as expected
The COPOM kept the monetary policy rate unchanged at 0.75%, as expected.
According to president Bolsonaro, more changes will come during the week, which will be a major focal point for the markets in coming days.
The decision impacted our short-term forecasts for IPCA inflation
We still expect GDP growth to recover to 10.7% in 2021 supported by a positive carry-over effect
The decision impacted our short-term forecasts for IPCA inflation
The median of year-end Selic rate expectations increased 25 bps in 2021 (to 3.75%)
The median of year-end Selic rate expectations increased 25 bps in 2021 (to 3.75%)
We expect the Colombian economy to rebound this year, with growth of 5.0%.
We expect Banxico to continue easing its policy rate (we expect 25-bps rate cuts in each of the next two policy meetings)
For 2020 as a whole, our GDP estimate remains at -4.1%
We expect Banxico to continue easing its policy rate (we expect 25-bps rate cuts in each of the next two policy meetings)
The deeply negative reading in core retail sales is caused by the non-linearity of the seasonally adjusted series.
The consumer price index IPCA climbed 0.25% in January, printing below our call (0.29%) and market expectations (0.31%).
The consumer price index IPCA climbed 0.25% in January, printing below our call (0.29%) and market expectations (0.31%).
Consumer prices rose 0.7% in January from December (0.6% last year).
The monthly gross fixed investment (GFI) fell by 12.1% yoy in November.
Consumer prices surprised to the upside in January, rising 0.7% from December (0.6% last year), above the market consensus and our call.
The re-tightening of social distancing measures at the beginning of the year is expected to have a negative impact in internal demand
Manufacturing and construction activity rebounded in 4Q20, surpassing pre-pandemic levels
Manufacturing and construction activity rebounded in 4Q20, surpassing pre-pandemic levels
Among the measures, they highlighted fiscal reforms, as well as tax and administrative reforms
Among the measures, they emphasized fiscal reforms, and tax and administrative reforms
Our estimate for GDP growth in 4Q20 is 3.0% qoq/sa. We continue to forecast a 4.1% decline for 2020 as a whole
As widely expected, the results confirmed the victories of the administration-backed favorites in both institutions
Our estimate for GDP growth in 4Q20 is 3.0% qoq/sa. We continue to forecast a 4.1% decline for 2020 as a whole
As widely expected, the results confirmed the victories of the administration-backed favorites in both institutions
In spite of the split vote, there is consensus within the board that the monetary policy stance must remain expansionary
In spite of the split vote, there is consensus within the board that the monetary policy stance must remain expansionary
Seasonally-adjusted, formal job creation reached 353k (there is a negative seasonality in December), from 390k in November
Seasonally-adjusted, formal job creation reached 353k (there is a negative seasonality in December), from 390k in November
Unanimous support to continue to signal low-for-long rates
All confidence indicators released so far show a decline in January.
Unanimous support to continue to signal low-for-long rates
For 2021, we expect a GDP of 5.0%, supported mainly by the external demand (U.S. economic activity).
We now expect a 25-bp hike in March, followed by two 50-bp moves, with a final 25-bp hike that would take the base rate to 3.5%
In spite of this decline at the margin, industrial confidence remains very strong, and significantly above the pre-pandemic level of 101.4
Higher energy prices and persistent core inflation were the main drivers
The size of the fiscal consolidation for this year is likely to be discussed with the IMF
The Copom left the base rate unchanged, at 2.0% pa, and, as expected, scrapped the forward guidance that precluded short-term rate hikes
The Copom left the base rate unchanged, at 2.0% pa, and, as expected, scrapped the forward guidance that precluded short-term rate hikes
We believe that the committee will withdraw its forward guidance, but it will keep the Selic rate at its all-time low of 2.00% p.a.
There are currently six million doses of the CoronaVac vaccine available for use
We believe that the committee will withdraw its forward guidance, but it will keep the Selic rate at its all-time low of 2.00% p.a.
There are currently six million doses of the CoronaVac vaccine available for use
There are currently six million doses of the CoronaVac vaccine available for use.
We expect retail sales to decline in December, but preliminary data indicate some improvement in January
We expect the BCRP to keep its policy rate at 0.25% throughout the year amid a still wide negative output gap
We updated our 4Q20 GDP forecast to +3.0% (from +2.9%) qoq/sa, and continue to forecast a 4.1% drop in 2020 as a whole
Noticeable acceleration in annualized quarterly inflation, which hit 54% in 4Q20.
We updated our 4Q20 GDP forecast to +3.0% (from +2.9%) qoq/sa, and continue to forecast a 4.1% drop in 2020 as a whole
We expect prices to increase 0.24% in January, 0.41% in February and 0.24% in March
We expect prices to increase 0.24% in January, 0.41% in February and 0.24% in March
Industrial production growth was driven by construction output
Industrial production growth was driven by construction output
Industrial production enjoys a strong recovery process
According to Butantan, none of the volunteers that received the CoronaVac vaccine suffered major complications when infected with the virus
Industrial production enjoys a strong recovery process
According to Butantan, none of the volunteers that received the CoronaVac suffered major complications when infected by the virus
The efficacy results of the CoronaVac vaccine may be disclosed today
The efficacy results of the Coronavac vaccine may be disclosed tomorrow
For 2021 higher inflation is likely (Itaú 3.0%)
Exports as well as imports declined in 2020 due to the slowdown in global trade amid the pandemic
A moderate correction is expected if inflation expectations continue to fall
Exports as well as imports declined in 2020 due to the slowdown in global trade amid the pandemic
We expect the monthly GDP proxy to have expanded 1% YoY in the month (-1.2% in October)
Fiscal results better at the margin
According to our estimate, the seasonally-adjusted unemployment rate receded to 14.4%, from 14.7% in the previous month
According to our estimate, the seasonally-adjusted unemployment rate receded to 14.4%, from 14.7% in the previous month
Overall, confidence indicators showed mixed results in December
Industrial confidence is significantly above the pre-pandemic level of 101.4 (registered in February)
Industrial confidence is significantly above the pre-pandemic level of 101.4 (registered in February)
Construction confidence increased slightly in December, while retail confidence dropped further.
The indicator reached 414k jobs in November, stronger than market expectations (269k) and our call (260k).
The IPCA-15 climbed 1.06% in December, printing below our estimate and market expectations (both at 1.17%).
The index registered the third consecutive drop.
Retail sales fell by 7.1% yoy, worse than our forecast of -4.6% and market expectations of -5.1%.
The central bank kept the policy rate unchanged at 1.75%, as widely expected.
We expect Banxico to resume the easing cycle in the next policy decision
A split board and the change in guard mean a deeper easing cycle cannot be ruled out.
We expect Banxico to resume cutting the policy rate as soon as 1Q21
We recently raised our 2020 GDP growth forecast to -11% from -12%
We recently raised our 2020 GDP growth forecast to -11% from -12%
Headline inflation posted a lower-than-expected increase in November, following the October spike.
Minutes clarify conditions to discard forward guidance. Given our inflation forecast, we expect this to happen only in the fall (S. Hem.)
We expect growth of 5% next year, bouncing back from a 7% decline forecast for 2020
At the margin, revenue increased 1.7% mom/sa
Our LatAm Macro Monthly was released today, featuring scenarios for Brazil, Mexico, Argentina, Chile, Colombia, Peru and the global economy
At the margin, revenue increased 1.7% mom/sa
We expect significant GDP growth in 4Q20 (our current forecast: +2.9% qoq/sa)
We expect significant GDP growth in 4Q20 (our current forecast: +2.9% qoq/sa).
We expect an increase of 1.27% in December, so that the IPCA will climb 4.44% in 2020
We see rates stable at 0.5% throughout 2021 and part of 2022
We see rates stable at 0.5% throughout 2021 and part of 2022
We see inflation ending the year significantly below the lower bound of the central bank’s 2% – 4% range around the target
The National Institute of Statistics (INE) reported nominal wages increased 0.3% from September to October.
We expect 4Q20 GDP to increase 2.9% qoq sa (-1.5% yoy) and we are keeping our forecast of a 4.1% decline in 2020 as a whole
The latest industrial production report is yet another sign that GDP will continue to expand significantly in 4Q20
We expect 4Q20 GDP to increase 2.9% qoq sa (-1.5% yoy) and we are keeping our forecast of a 4.1% decline in 2020 as a whole
The surprise in October puts a downside bias to our call of a 5.5% GDP contraction for this year
In October, industrial production climbed 1.1% mom/sa.
We changed our IPCA 2021 forecasts to 4.3% given the change in the electricity flag to red 2 in December
Due to these changes, we now expect IPCA inflation at 4.3% in 2020 and 3.1% in 2021
In our view, employment and the participation rate will continue to recover in line with the ongoing rebound in economic activity
Given the risk of a second COVID-19 wave across the state, the government decided to return the entire state to the “yellow phase”
The service sector, which was responsible for substantial losses during the crisis, is now posting strong gains
Employment improves at the margin
The service sector, which was responsible for substantial losses during the crisis, is now posting strong gains
Using seasonally adjusted figures, retail sales expanded for the fifth consecutive month, by 2.7% mom in September
We forecast increases for the headline index of 0.78% in November and 0.71% in December
We forecast a near-zero or marginally positive current account balance in the next few years
We forecast increases for the headline index of 0.78% in November and 0.71% in December
We forecast a 0.73% monthly increase, leading the 12-month reading to 4.13% (from 3.52% in October)
The industrial confidence is significantly above the pre-pandemic level of 101.4 (registered in February)
We expect GDP to fall by 12.6% in 2020
We expect the demand-side breakdown of GDP to show a broad-based recovery in 3Q20, reflecting the easing of social distancing measures
We expect the demand-side breakdown of GDP to show a broad-based recovery in 3Q20, reflecting the easing of social distancing measures
We expect a GDP decline of 5.5% this year (+1.1% in 2019), with a rebound of 5.5% next year.
For 2021, a favorable carryover and a better external environment will likely lead to GDP growth of 4.7%
We expect a GDP decline of 5.5% this year (+1.1% in 2019), with a rebound of 5.5% next year.
Lawmakers elected as head of Congress (and thus interim president until July 2021) Francisco Sagasti
For 2021, a favorable carryover and a better external environment will likely lead to GDP growth of 4.7%
Lawmakers elected as head of Congress (and thus interim president until July 2021) Francisco Sagasti
For 2021, we see GDP growth of 4.7%