The impact of rapid real appreciation on Brazil’s export competitiveness will remain a key political and economic policy issue for the foreseeable future. Robust economic growth and huge fiscal stimulus injections in Latin America’s largest economy continue to fuel higher inflation, leading to higher interest rates and attracting real-boosting capital inflows due to a widening… [Read more]
The decision by the Banco Central do Brasil (BCB) to hike the benchmark Selic rate by 50 basis points (bps) to 11.25% at its January meeting alters my 2011 interest rate forecasts but does not shift my outlook for monetary policy, namely that Brazil’s monetary authorities will continue to view rate hikes as something of… [Read more]
In line with my view that Brazil was the most likely country in Latin America to introduce capital controls to stem currency appreciation, Finance Minister Guido Mantega has announced a doubling of the tax on foreign purchases of fixed income securities from 2% to 4% with immediate effect. The move essentially increases the tax first… [Read more]
On this week’s Business Monitor Podcast, we continue our theme of ‘top emerging market picks’ with a focus on Latin America. BMI’s Head of Country Risk and Financial Markets Justin Patrie discusses the region with Head of Latin America Analysis Richard Hamilton and Latin America Analyst Martha Stickings. Specific countries discussed include Colombia, Brazil, Panama… [Read more]
Risk Watchdog and his colleagues at Business Monitor International (BMI) have grown very bullish Latin American currencies. Three views in particular stand out and form part of the BMI Global Key Market Views portfolio: Last Friday, my colleagues at BMI initiated a long Chilean peso/short US dollar view, which hit the initial CLP510.00/US$ target within… [Read more]
With the economy taking a knock from global headwinds – and President Lula set to leave office in 2010 – can Brazil retain its place amongst the EM elite? Mark Schaltuper, Latin America country risk analyst at Business Monitor International, explains why he is still excited about the Brazilian growth story, and which are the… [Read more]
