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Evening Edition – All eyes on possible policy signals in Davos

Janeiro 20, 2020

Minister Paulo Guedes may provide policy signals and reveal details of the economic team’s flight plan into 2020

Talk of the Day

Brazil

The World Economic Forum annual meeting, in Davos, will begin tonight. Minister Paulo Guedes will represent Brazil in a series of events, in which he may provide policy signals and reveal details of the economic team’s flight plan into 2020.

The BCB released its weekly survey with market participants (Focus). The median of IPCA inflation expectations oscillated to 3.56% for 2020 (from 3.58%), and remained unchanged at 3.75% for 2021 and 3.50% for 2022. On economic activity, the median of GDP growth remained virtually stable at 2.31% for 2020, and did not change for 2021 and 2022, at 2.50% for both years. Similarly, the median of year-end Selic rate forecasts remained stable for the three-year horizon (2020-2022): at 4.50% for 2020, at 6.25% for 2021 and 6.50% for 2022. On the exchange rate front, expectations oscillated to BRL 4.05/USD (from 4.04) for 2020, remained flat at BRL 4.00/USD for 2021 and reached BRL 4.05/USD for 2022 (from 4.02).

Mexico

Tomorrow’s agenda: INEGI will announce December’s unemployment rate at 9:00 AM (SP time). We expect the unemployment rate at 3.6%. Formal job creation for December grew at a soft pace (1.7% in December, practically unchanged from November). 

Colombia

Tomorrow’s agenda: The trade balance for the month of November will be released on Tuesday. Another deficit of USD 813 million was recorded in October, but with some narrowing from the USD 1.2 billion deficit reported a year earlier. As a result, the 12-month rolling trade deficit edged down to USD 10.1 billion, from the USD 10.5 billion recorded in September and USD 7.1 billion for 2018. For November, we expect accelerating fuel imports amid still weak commodity exports to result in a large USD 1.6 billion trade deficit (USD 0.9 billion deficit one year earlier).



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