![]() ![]() ![]() This positive macroeconomic environment has not gone unnoticed by investors. “Capital investment is on the rise and consumer confidence remains strong.As US companies moved their operations closer to home, nearshoring has translated into strong capital flows to Mexico and remittances are also robust as a result.” “Mexico, with its close ties to US industry and demand, has benefited from geopolitics and the surprisingly resilient US economy.Right now, real rates are close to 9% while equity multiples are below 8x,” the report synthesizes. “Inflation is easing, which may give the monetary authority room to ease.On the other hand, Citi projects that Brazil’s new fiscal rules should ease concerns around fiscal excesses and should also give the central bank more room to manage inflationary risks.The Asian giant, Brazil’s main trading partner, is expected to grow by close to 6% in 2023, providing ample support for economic activity in the country in the years ahead. As it is, China would partially offset this current slowdown in Brazil.Against this backdrop, Citi projected that, as the impact of higher interest rates kicks in and the rest of the world slows, the country is also likely to slow its real growth to less than 1% in 2023. Brazil’s economy surprised positively in 2022, growing by 2.9%.The Citigroup report highlights some aspects about Brazil: The fall in the region’s countries’ domestic consumption, and the frequency of adverse climatic and social events are putting Latin America on a path to slow growth The outlook for Brazil ![]()
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