Summary: For all countries excluding Mexico, analysts are expecting the reversal of their tightening cycles and are trying to predict the beginning of rate cuts. Even bonds considered extremely toxic could offer an interesting opportunity. Latin America is likely to continue offering attractive returns for the time being in order to compensate investors for the region’s inherent risk.
Pedro Pablo Kuczynski’s plan of 5% GDP growth by 2018 strikes as being overly ambitious, and the means to achieving it is not clear. Peru’s new government has the advantage of inheriting a country with positive inertia and a sound macroeconomic standing. The true size of the gap between political rhetoric and policy- making reality will become clear soon enough. Continue reading Peru: Is PPK’s Government Plan Sound Economics?
Mexico’s EWW down 3.3% last week as 2Q16 results disappointed. AMX plunged 8.3% while Cemex rose 10.9%. Brazil´s EWZ continues uptrend posting a weekly gain of 1.2%. VALE ´s results surprised while Ambev missed estimates. Continue reading Heatmap Weekly Summary (July 29)
Weekly update and analysis on what is happening in our all-LatAm ADR sample. Main LatAm markets continued rallying as the IMF revised upward GDP growth Continue reading Heatmap Weekly Summary (July 22nd)
The perception that LatAm as a region is less fundamentally exposed to the Brexit fiasco than other emerging markets is borne out by the data. Brazil and Colombia conduct a large amount of trade with the U.K. and the rest of Europe as a share of their total Continue reading Brexit and Latin American Exports
The World Bank now expects LatAm’s output to contract 1.3% in 2016, after shrinking 0.7% in 2015. We revise some of the new forecasts here. Continue reading World Bank Cuts Latin America’s GDP Growth Forecast
We review the performance and volatility of LATAM equity indices ETF´s for the past five years. Spoiler: it looks ugly. Continue reading The Ugly 5-Year Performance of LatAm Equities