General: During a recent meeting of the Inter-American Development Bank (IDB) in Miami, the contrasting moods of the US bankers versus the Latin American bankers could not have been in sharper focus. Whereas there was widespread gloom on the US side, Latin American bankers were bragging about the vigor of their own economies. Indeed, Latin America is currently doing better than at any previous time since the 1960s. Economic growth has averaged at over five percent a year since 2004, inflation seems to be under control in most places and direct foreign investments are pouring into the area in record numbers. Current and fiscal accounts in the region are registering surpluses, and the credit crunch to the north seems to have bypassed Latin America. So all is well then? Not quite. The global explosion of energy and food prices has affected the region as well. The central banks in Chile and Colombia have missed their inflation targets, and the Central Bank of Brazil was forced to institute an interest rate hike of 0.5 percent. The entire area relies on exports to the US to varying extents, but nobody more so than Mexico. But even in Mexico the economy remains relatively strong; despite the slowing economy to the north, Mexico's industrial production shows a robust gain.
There is no doubt that next year will pose real challenges to the economies of the region. Fortunately, some countries have set aside funds to stimulate their economies should the need arise. Chile, for example, has set aside US$15.0 billion out of their increasing copper profits for exactly this purpose. The only real blot in this otherwise pleasant landscape is Venezuela. Windfall profits from their petroleum exports are being spent in record time; inflation is dangerously close to becoming out of control and recently forced nationalization of crude oil ventures as well as of the Sidor steel plant will further discourage foreign investments.
GDP: + 9.1% in Q4
Consumer Prices: +8.8% in March
Industrial Production: +5.2% in March
Unemployment: 7.4% in Q4
Trade Balance: +$12.1 billion at end of February for the latest twelve months
Steel Production: 509,000 metric tons in March, or 6.9% ahead of last year. In the first quarter of the year, 1.368 million metric tons were produced, or 11.4% more than last year
Currency: Peso 3.18 to US$1 on April 23 (3.08 a year ago)
GDP: +6.2% in Q4
Consumer Prices: +4.7% in February
Industrial Production: 9.7% in February
Unemployment: 8.7% in February
Trade Balance: $34.1 billion at end of March for the latest twelve months
Steel Production: 2.96 million mt in March, or 6.3% ahead of last year. In the first quarter of the year, 8.641 million mt were produced or 8.1% ahead of last year.
Currency: Real 1.66 to US$1 on April 23 (2.03 a year ago)
GDP: + 4.0% in Q4
Consumer Prices: +8.5% in March
Industrial Production: +5.7% in February
Unemployment: 7.3% in February
Trade Balance: +$22.5 billion at end of March for the latest twelve months
Copper Price: $8,519.00/mt on April 25 for delivery in three months
Currency: Peso 445 to US$1 on April 23 (527 a year ago)
GDP: +8.5% in Q4
Consumer Prices: +29.1% in March
Industrial Production: +2.5% in January
Unemployment: 6.7% in Q4
Trade Balance: +$23.7 billion at end of Q4 for the latest twelve months
Steel Production: 445,000 mt (e), or 7.0% less than last year. In the first quarter of the year, 1.268 million mt were produced, or 3.5% less than last year. The announced nationalization of the Sidor plant could really turn ugly. Tenaris, holding 60% of the shares, has asked for $3.6 billion in reimbursement. Incredibly, the government has offered $800 million. Tenaris had acquired their share for $1.5 billion six years ago.
Currency: Bolivar 3.33 to US$1 as opposed to Bolivar 4.25 on the "unofficial" market
GDP: +8.1% in Q4
Consumer Prices: +5.9% in March
Industrial Production: +8.8% in February
Unemployment: 12.0% in February
Trade Balance: +$1.2 billion at end of January for the latest twelve months
Steel Production: 110,000 mt in March, or 1.7% less than year. In the first quarter of the year, 310,000 mt were produced, or 2.2% ahead of last year.
Currency: Peso 1,764 to US$1 on April 23 (2,113 a year ago)