GDP in Argentina; rates in Mexico and Colombia

GDP in Argentina; rates in Mexico and Colombia
GDP in Argentina; rates in Mexico and Colombia

Bloomberg Line — This week the First quarter GDP 2024 in Argentina. According to analysts at Bloomberg EconomicsFelipe Hernández and Adriana Dupita, there would be a technical recession.

Experts suggest that the Argentine economy will decrease by -3.0% as of March compared to the fourth quarter of 2023, when a quarterly drop of 1.9% was seen. The forecast includes April activity showing a slightly less gloomy start to the second quarter.

Get to know: These are the notable events and indicators of the week

Finally, in Colombia and in MexicoHernandez and Dupita central banks are projected to take different positions regarding interest rates. In it first case the relaxation rhythm would be maintained with a reduction from 11.75% to 11.25%. In Mexico there would be no modifications and the reference rate would remain at 11% amid growing economic concerns.

Below are the economic events of the week by country and day:

Argentina

He Monday June 24 will be published on First quarter GDP 2024. Economists expect the data to confirm that Argentina is in a technical recession, following a 1.9% quarterly decline in the fourth quarter, “which highlights the costs of President Milei’s shock therapy ”they said.

For his part, the Friday June 28 will be announced Economic activity index for April of 2024, which likely slowed its contraction in April to -4.7% year-on-year, due to a slight recovery in manufacturing and construction “from the very low levels of March and a rebound in agriculture from the depressed levels of last year’s drought.”

Brazil

He Tuesday June 25 will be published Minutes of the monetary policy meeting of the Central Bank. The experts of Bloomberg Economics They hope the document will shed light on whether the board discussed any changes in the balance of risks around its forecasts or a possible rate hike.

For his part, the Wednesday June 26 will be announced Consumer price inflation in the first two weeks of the monthwhich could be 0.50% month-on-month and 4.18% year-on-year, “confirming that inflation is relatively moderate despite a jump in the annual figure,” according to Hernández and Dupita.

That same day the Meeting of the National Monetary Council of Brazil. In its session last year, the CMN set the inflation target at 3% for 2026. The aforementioned analysts anticipate that the 3% target will be maintained for 2027. However, it is possible that President Luiz Inácio Lula da Silva will issue a decree outlining the process before this week’s meeting.

Also, the Thursday June 27 will be disclosed Quarterly inflation report from the Central Bank of Brazilwhich will provide more details on the assessment of economic conditions and risks, which guided the central bank’s decision to pause the easing cycle while policy is still tight.

Finally, the Friday June 28 will be published Unemployment rate for May 2024. This could remain stable at 7.5% compared to the previous month, while the seasonally adjusted rate would increase to 7.4%, “derived from a slower increase in the level of employment,” explained the experts from Bloomberg Economics.

Chili

He Friday June 28 will be published Retail sales for May 2024. Hernández and Dupita predict that retail sales probably increased by 2.7% year-on-year, which would imply a small month-over-month advance after a 0.5% drop in April, despite the acceleration of inflation, the low consumer confidence and weak labor market conditions.

That same day the Industrial production for May 2024, which probably increased by 5.0% compared to the previous year, helped by the year-on-year comparison. This forecast would imply that production recovered after small monthly declines in April and March.

Colombia

He Friday June 28 will take place Central Bank Monetary Policy Meeting. The experts of Bloomberg Economics They expect the Issuer to reduce its reference rate to 11.25% from 11.75%. This would match the 50bp reductions in April and March and bring total easing to 200bp since the cycle began in December.

Mexico

He Monday June 24 will be published Biweekly consumer price inflation in the first two weeks of the month. Hernández and Dupita predict that it increased to 4.66% year-on-year from 4.59% in the second half of May. If so, the figure would be above the target of 3.0% +/- 1 percentage point.

For his part, the Thursday June 27 will be announced Trade balance for May in 2024, which likely posted a deficit of $1.37 billion, compared to a gap of $3.75 billion in April and a deficit of $74 million a year earlier.

That same day the Central Bank Monetary Policy Meeting. The analysts consulted expect that the Issuer, in a unanimous decision, will maintain the reference rate at 11%, for the second consecutive time. “It is likely to be reiterated that any reduction would be gradual and that monetary conditions will remain tight over the two-year outlook,” they said.

 
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