According to Bloomberg, specialists hope for growth and stability in Latin America. Lizzete Lara, who is the expert in the monetary, financial and value markets for the analysis and data agency explains the following:
The recovery and stability of Latin America for 2018 will depend on the capacity that it has to survive the different results from the elections that will occur in the region, as well as the advance of key subjects, such as the renegotiation in the TLCAN.
In 2018, more than 350 million people will elect the new political leaders of the region. The countries that will be choosing this year are as follows, listed in order in which there will be elections: Brazil, Mexico, Colombia, Costa Rica, Paraguay and Venezuela.
On the other hand, during March, the new President of Chile will take office, while lawmakers in Ecuador, El Salvador and Honduras discuss their management. In addition, Lara tells us that these changes could bring volatility in different Latin American markets.
Peru is having municipal elections in November, however, everyone’s focused on the current Mayor of Lima, Luis Castañeda Lossio. According to analysts and experts the Mayor’s management is disastrous for the large number of irrelevant millionaire works, traffic issues, poor cultural policy and lack of respect for the citizen and the heritage of the city.
BI analysts expect a 2.7% growth in Latin America’s largest economies, this is a fairly large percentage regarding what they had estimated in 2017, which was 1.6%.
For Bloomberg experts, there are three different factors that can give a push to the region this year. The first one is a higher external demand, in addition to the growth in positive economics leaders, such as Europe, United States and China, with trading partners in Latin America.
The second is the high prices of raw materials, however, according to a consensus of BI economists, prices remain close to current levels. And finally, the third is the conditions of global financial markets, which moderate settings remain appropriate to stimulate positive growth in the region.
The expectation, as designated by Bloomberg specialists, is that there is short-term high volatility, but the currencies will have the same range of the previous year. This could be the effect of the forces that dominate the currency market during the year.
Different commodity prices are still seen as favorable, in addition to a change in monetary conditions that will be much less conducive to developing markets could generate a debilitating pressure. In addition, BI economists expect that after the descent, the inflation will bottom out and will remain within the limits which established the central banks.