South America

Chile’s finance minister said the job of stabilizing the nation’s economy following a period of high inflation and overheated expansion is nearly complete as consumer price pressures wane, Bloomberg News reported. The annual inflation rate is about third of what it was a year ago and will continue declining to 4% in December, Mario Marcel said Wednesday in a Bloomberg Television interview from London, where he is meeting business executives as part of the Chile Day investors event. That consumer price level would be just above the central bank’s 3% target.

Argentina suffered a big legal defeat on Friday as a U.S. judge ruled that the country must pay about $16 billion to minority shareholders of YPF arising from the government’s 2012 seizure of a majority stake in the oil and gas company, Reuters reported. U.S. District Judge Loretta Preska in Manhattan ruled in favor of Burford Capital, which funded the litigation brought by shareholders Petersen Energia Inversora and Eton Park Capital Management LP, and according to court papers was entitled to a respective 70% and 75% of their damages.

Uruguay's central bank is likely to cut its benchmark interest rate again at its next monetary policy meeting in October as inflation has fallen to a near two-decade low, governor Diego Labat told Reuters on Friday, Reuters reported. The South American country has led the region's pivot to rate cutting after sharp hikes by central banks around Latin America in recent years to rein in prices, an aggressive tightening cycle that helped many get inflation under control.

Former Americanas Chief Executive Miguel Gutierrez denies any knowledge of accounting irregularities during the two decades he was at the helm of the Brazilian retailer, he said in a letter sent to congressional investigators, Reuters reported. Gutierrez never "participated, authorized, ordered, tolerated or became aware of any act tending to manipulate the company's accounting or to enable any type of fraud", he said in the Sept. 4 letter sent to the congressional committee investigating the company's near-collapse and viewed by Reuters.

Chile's central bank on Wednesday lowered the top end of its estimate for the country's economic performance in 2023, saying it now forecasts gross domestic product (GDP) to show no growth in the most optimistic scenario, Reuters reported. The monetary authority previously expected an economic expansion of as much as 0.25% this year. It maintained the lower end of its GDP forecast at a contraction of 0.5%. The lowered estimate accounts for the impact of operational issues that have hit mining production in Chile, the world's largest copper producer, in recent months, the central bank said.

Industrial production in Brazil slipped by more than expected in July, data from government statistics agency IBGE showed on Tuesday, providing an initial sign the sector may cap economic growth in the third quarter, Reuters reported. Industry was key for the surprisingly strong growth recorded by Latin America's largest economy in the three months through June, but overall it has been stuttering this year as the sector grapples with high interest rates. In July, IBGE said, industrial output was down 0.6% from June, missing the median forecast of a 0.3% drop in a Reuters poll of economists.

Peru lowered its economic growth forecasts for 2023 and 2024 on Tuesday amid poor weather, lower private investment in mining, and anti-government protests earlier this year, Reuters reported. The South American country's economy is expected to grow 1.1% this year, the economy ministry said in Peru's official gazette. That is down from a previous estimate of 2.5%, after data showed the economy shrank in the first half of 2023. That would mark the slowest annual growth since 2009, excluding coronavirus-dampened 2020.

Argentina’s central bank expects monthly inflation in August to have accelerated to almost double the pace of July after the government devalued the peso, two officials said in another sign the economy is quickly deteriorating, Bloomberg News reported. The central bank estimates consumer prices will increase at least 10.6% from July, the fastest monthly rate since Argentina was coming out of hyperinflation more than three decades ago, the officials said, asking not to be named citing preliminary internal high frequency data and private online researchers like PriceStats.

Chile’s central bank sees its policy outlook largely unchanged by a drop in the peso and the potential inflation impact from recent devastating floods, the institution’s vice president said in an interview, Bloomberg News reported. Chile’s monetary easing, combined with doubts over the Chinese economy that’s a key buyer of the country’s commodities and hawkishness of the Federal Reserve have weighed on the currency, Pablo Garcia said from Jackson Hole, where central bankers gathered for a global symposium hosted by the Fed.

The Federal Reserve Bank of New York on Wednesday defended its plan to cut off a Puerto Rican lender's access to the U.S. central banking system following a federal crackdown on banks with links to Venezuela, Reuters reported. In July, Banco San Juan Internacional (BSJI) sued the New York Fed to halt the looming termination of its "master account," which lets banks access the Fed's electronic payment system, because of concerns about its compliance with U.S. sanctions and anti-money laundering rules.