High interest rates are the biggest risk for Latin America: BofA survey

The increase in rates of interest in the United States is the greatest risk facing Latin American economies this year, but very close, with a minimal difference, they also identified the policies that are being applied in the region, according to the results of the survey applied Bank of America Securities (BofA-Securities).

In the monthly survey among fund administrators, the proportion of managers who project that Mexico’s economic growth this year will be between 0 and 2.5% increased, where 40% of those interviewed coincide, which doubles the 20% collected last month. previous.

15% anticipate that it will register a GDP performance between 2.5% and 5 percent.

The administrators of investment funds consulted anticipated that the shock of inflation due to the war in Ukraine will be the trigger for the Bank of Mexico take the interest rate to a range of 8.25 to 9% at the end of this year, which contrasts with the expected 7 to 7.25% that was reflected in the March survey.

According to the results of the survey, the inflationary pressure, consequence of the war, as well as the financial tension due to the normalization of rates in the United States, will cause the Central Bank of Brazil to boost the selic rate to a level between 12% and 12.75 percent.

75% of the sample anticipates that the Brazilian economy will register a growth between 0 and 0.25% this year, a proportion that is far from the 50% of fund managers consulted who had these same projections the previous month.

Leave a Comment