South America

Argentina's economy has many problems, and dealing with a mountain of debt repayments over the next two years could determine whether the new government's economic road map succeeds, Reuters reported. The country's total sovereign debt exceeds $400 billion, some $110 billion of which is owed to the International Monetary Fund and to holders of restructured, privately-held eurobonds. With central bank reserves in the red by more than $10 billion and little chance of tapping the market, the country has some $16 billion in debt payments coming due next year.

Peru's inflation rate could converge to the central bank's target sooner than expected, the head of the bank said on Wednesday, arguing that the rate of rising prices in the Andean nation is now under control, Reuters reported. "We expect it to return to the (target) range, if not in December, in the first quarter or in April next year," central bank head Julio Velarde said, hinting at an earlier-than expected easing of inflation. The central bank had previously said inflation would converge to target in April.

A Sao Paulo judge on Tuesday approved bankruptcy protection for SouthRock Capital, which runs all Starbucks coffee shops and TGI Fridays restaurants in Brazil, according to a court filing, Reuters reported. SouthRock had filed for protection from creditors in late October. SouthRock said in a statement that with the approval, it will continue to restructure operations with the aim of protecting employees and customers, while it intends to keep operating stores as normal.

Brazil’s annual inflation rate fell to within the central bank’s target range, keeping policymakers on track to deliver a fourth straight borrowing cost cut at Wednesday’s meeting, Bloomberg News reported. Official data released Tuesday showed consumer prices rose 4.68% in November from a year earlier, just below the 4.7% median estimate of analysts surveyed by Bloomberg. Monthly inflation hit 0.28%. This year, the central bank targets annual inflation at 3.25% with a tolerance range of plus or minus 1.5 percentage points.

Argentina's new government will lay out its economic "shock" therapy plans on Tuesday afternoon in a bid to rein in triple-digit inflation and rebuild depleted foreign currency reserves, with markets and ordinary Argentines on tenterhooks about the impact, Reuters reported. Economy Minister Luis Caputo will announce the measures after markets close around 5 p.m. (2000 GMT), the spokesman for libertarian President Javier Milei, who took office on Sunday, told a news conference.

Argentina's consumer prices likely spiked around 12% in November alone, a Reuters poll of analysts showed on Monday, which will be the first monthly inflation data under the government of new libertarian President Javier Milei, Reuters reported. The South American country, which swore in its new government on Sunday, is battling triple-digit annual inflation already at 143% and climbing fast. Milei has said he will fight "tooth and nail" to bring inflation down. The Reuters poll of 22 analysts gave a median estimate of the CPI rising 11.9% in November, up from 8.3% in October.

As a deeply divisive re-write of Chile’s constitution comes to an end, interest rates fall and economic growth returns it seems that Chile’s bond market is regaining its mojo. But there may be one final sting in the tail from the last three years of social, political and economic turbulence, Bloomberg News reported. All 14 analysts and traders in a Bloomberg survey expect rating firms to downgrade their outlook on Chilean bonds, or lower the rating some time next year as the debt-to-gross domestic product ratio rises.

Argentina’s central bank limited the amount of foreign currency the nation’s commercial lenders can hold, in a push to discourage US dollar hoarding ahead of an expected devaluation by President-elect Javier Milei after his Sunday inauguration, Bloomberg News reported. The country’s central bank said that holdings may not be greater than the lowest amount recorded between Oct. 12 and Dec. 6, according to a rule published on its website Thursday. The measure — announced on the last business day of the current administration — goes into effect immediately and is valid until the end of the year.

Chilean consumer prices rose more than three times as fast as analysts expected in November, surprising investors ahead of the central bank’s final monetary policy meeting of the year. Swap rates and the peso soared in response, Bloomberg News reported. Prices climbed 0.7% in the month, above the 0.2% median estimate of analysts surveyed by Bloomberg. While annual inflation slowed to 4.8%, it also exceeded the 4.2% forecast, the national statistics institute reported Thursday. Chile’s central bank targets cost-of-living increases at 3%.

Gol Linhas Aereas Inteligentes SA plans to restructure its balance sheet yet again as it buckles under a heavy debt load and the high costs of operating an airline in Brazil, Bloomberg News reported. Gol hired Seabury Capital to help review its debt and other financial obligations, and free up cash by renegotiating its deals with lessors, the company said in a filing Friday. The move triggered a downgrade to CCC- from CCC+ by S&P Global Ratings, which warned of room for a further cut amid refinancing risks.