LatAm: strong exports

- LatAm: strong exports "The strength of raw material exports keeps the trade balances of Argentina, Brazil and Chile in the black. However, Brazil’s current account is deteriorating rapidly, and Mexico’s is still negative. Bank lending in Brazil slowed in June, in line with other economic activity indicators. Public spending keeps growing fast in Argentina and Peru, but is still being financed by increasing revenues. Employment figures also improved in Argentina, where the unemployment rate fell to 7.9%; however, unemployment is worsening in Venezuela, having increased to 8.7%. On the other hand, the Central Bank of Argentina announced the relaxation of the Monetary Program for the last 2 quarters and Peru’s currency strength leads the Central Bank to raise the bank reserves requirement and to S&P to ratify the solvency of public debt, changing the outlook to positive."
- Fears about the global economic cycle had asymmetrical effects in Latin America due to local factors. The outlook is still positive for the region’s assets "Brazil and Mexico experienced the largest exchange rate adjustments following the release of negative economic indicators in the USA, whilst the currencies of Chile, Peru and Colombia strengthened. The appetite for LATAM issues (stocks and private debt) remains high in the face of positive economic differentiation in most of the countries in the region."

BBVA Latin Weekly Observatory 20100827

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