Weekly

Weekly Reports

Brazil’s problems strike the micro more than the macroeconomy

Fourth week
of May 2017
Last week, there were two political events originated in the external front that may have an impact on the local macro: Trump is under scrutiny for his link with Russia and Brazil’s President Temer is under the microscope for corruption scandals. Although it is yet premature to accurately guess the the magnitude of ...

What happened to the real exchange rate since the exit from the “cepo”?

Second week
of May 2017
Latin America has completed a significant part of the external rebalancing cycle that it had to face after the fall in commodity prices, which started during the second half of 2014. This means that regional currencies recently have been appreciating relative the most important ones and explains why, since the “cepo...

Does the accumulation of reserves make sense?

Fourth week
of April 2017
The Central Bank recently made an announcement on its intention to increase its reserves stock to reach a level of 15% of GDP, which implies a rise of around USD 30 billion. Does this statement make sense? The answer is yes. Argentina currently has a reserves stock net of liabilities in Dollars of only USD 13.5 bil...

The incidence of regulated services in inflation grows

Third week
of April 2017
Lowering inflation by delaying some prices, as it was done with public services or the exchange rate during previous years, is not the same than doing it without delaying any price. Mainly because the former kind of disinflation will inevitably be transitory, like the one in 2015, for example. Lowering inflati...

Reducing the country risk, the great opportunity to fit in the neighbourhood

Fifth week
of March 2017
Last week there was a placement of International Bonds from the Republic of Paraguay. USS 500 million were issued with a maturity term of 10 years, and the investors’ appetite for these bonds was significant, given that demand was 6 times bigger than the issued amount. The interest rate should make us envious: 4.70%...

Unemployment is not useful to predict the recovery

Fourth week
of March 2017
Last week, INDEC published the labor market statistics for the last quarter of 2016, accounting for a fall in the unemployment rate, which went from 8.5% in the third quarter down to 7.6%. Although this figure looks low compared to previous quarters and it is encouraging as it is the second consecutive fall, it is y...