Brazilian equities have largely underperformed their EM peers in USD terms since the beginning of the year. Rising public debt and inflation are the two main forces weighing on the Brazilian bourse. Our Emerging Market…
Two of Brazil’s ever-recurring demons have come back to haunt investors: public debt sustainability and persistent inflation. According to the latest report from our Emerging Markets Strategy (EMS) team, these troubles are…
Brazil’s two macro demons – a rising public debt-to-GDP ratio and inflation – have resurfaced and will worsen over the coming months. Yet, President Lula will pay lip service to fiscal concerns without enacting meaningful cutbacks.…
Non-trivial macro divergences have emerged between mainstream LATAM economies. This report compares and ranks Brazil, Mexico, Colombia, Chile, and Peru based on their business cycle outlook, macro policy stance, external accounts,…
We dig into the USD-denominated Emerging Market Sovereign Index to see which credit tiers and countries offer value relative to US Credit.
While 2024 will see various election risks, global geopolitical uncertainty is driven by the US election and its struggle with Russia, China, and Iran. The stock market can manage local domestic political risk. But it will correct…
The Central Bank of Brazil (BCB) has cut the Selic rate by 50 basis points in each of the past four meetings and has alluded to maintaining this size of cuts for the coming meetings. Governor Roberto Campos Neto stated last month…
The Brazilian government and the central bank will be prioritizing growth over curbing the fiscal deficit and inflation. The outcome of an easy policy mix is that growth and inflation will be higher relative to market expectations,…
Coffee prices have surged in recent days and have now gained 8.5% over the past week. Two main forces are behind this rally. First, the recent pause in the US dollar strength is a tailwind for coffee prices. In particular, the…
In this report, we explore Brazil’s inflation and monetary policy outlook, the Lula administration’s back-and-forth between pragmatism and populism, and how these factors will affect Brazilian financial markets going forward. All in…