South America

The bolivar is plummeting, breaking a rare stretch of stability for Venezuela’s battered currency, Bloomberg News reported. It has lost a third of its value so far this month, hitting 9.33 bolivars per US dollar on the parallel exchange market Thursday, according to data compiled by Bloomberg. That’s the steepest monthly decline since January 2021. Controlling the exchange rate has been a key ingredient of President Nicolas Maduro’s strategy to halt a four-year hyperinflation bout, which ended in December.
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Chile’s record current account deficit will keep the peso under pressure long after the central bank’s $25 billion intervention program is done and dusted, Bloomberg News reported. The deficit swelled to 8.5% of gross domestic product in the second quarter, the highest for at least two decades. That was roughly triple the year-earlier figure and represented $6.6 billion leaving the country in just three months. Not only is that rate of outflow unprecedented this century, it also comes at the worst possible moment as financing costs rise worldwide.
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Brazilian central bank chief Roberto Campos Neto on Tuesday predicted that inflation will reach 6.5% or a little lower this year, amid government measures that lowered taxes on key goods, Reuters reported. The estimate is more optimistic than private economists' expectations of inflation at 6.82%, according to a central bank weekly survey, but still above the official target of 3.5%, plus or minus 1.5 percentage point. "This year, inflation is going to be around 6.5%, perhaps a little bit lower.
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Argentina's government will launch three measures in the coming days aimed at restricting imports and preserving the central bank's dwindling foreign currency reserves, a source told Reuters on Tuesday. The measures come as new data on Monday showed a trade deficit in July of $437 million, the second deficit in a row for Latin America's third-largest economy.
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Argentine Economy Minister Sergio Massa tapped veteran economist Gabriel Rubinstein as secretary of economic planning, to help craft the policy response to a currency slump and the fastest inflation in three decades, Bloomberg News reported. Rubinstein, who has long run his own consulting firm, served on the central bank’s board during the administration of late President Nestor Kirchner in 2005, among other government roles. Massa, a career politician, was sworn in earlier this month.
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Since 2011, Peruvians have lived under seven presidents and seen four ex-leaders detained or wanted on corruption allegations. Yet, in the same period Peru has held onto the unlikely title of the fastest growing major economy in Latin America, Reuters reported. That period of standout growth is set to end this year, an analysis of World Bank data and International Monetary Fund forecasts shows, with Colombia overtaking Peru. Slowing growth at the world's No.
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Chile's gross domestic product came in below expectations in the second quarter of 2022, central bank data showed on Thursday, leading economists to forecast a potential recession as pandemic-related stimulus is unwound, Reuters reported. The Andean country's economy grew 5.4% in the second quarter from a year earlier, but showed no growth from the previous three months in seasonally adjusted terms. The performance highlighted Chile's struggle to grow as the central bank aggressively tightens its monetary policy to tame soaring inflation, which reached a near three-decade high last month.
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Ecuador plans to pay off a debt it owes to French oil company Perenco at the end of this year and is open to a dialogue to determine how the payment should be made, the country's economy minister said on Wednesday, Reuters reported. Ecuador is obliged to pay compensation to Perenco after the World Bank's International Centre for Investment Disputes (ICSID) ruled the country had unlawfully ended a production-sharing agreement with Perenco and owed it $391 million including interest.

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LATAM Airlines Group hopes to exit chapter 11 bankruptcy protection in the last quarter of 2022 after securing the financing plus U.S. bankruptcy court and shareholder approval for its restructuring plan, says Group Chief Executive Officer Roberto Alvo, ch-aviation.com reported. "We have closed the second quarter with significant progress in our reorganization process under Chapter 11, and we hope to emerge from it during the last quarter of this year, Alvo said in a statement.

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Brazil's consumer prices decreased more than expected in July, the country's statistics agency said on Tuesday, with the steepest drop ever on the benchmark IPCA index off the back of a string of anti-inflation measures by the government and central bank, Reuters reported. Prices in Latin America's largest economy fell by 0.68% last month, the IBGE statistics agency said. It was the lowest rate recorded since inflation measurements began in January 1980, IBGE said.
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