• New foreign-exchange measures in Argentina and Venezuela
  • Inflation accelerates in Peru and continues high in Venezuela in October
  • Tax receipts up in Argentina and Brazil
  • Some slowdown in deposit growth in Peru
  • Industrial output slows even more in Brazil


New foreign-exchange measures in Argentina and Venezuela
Argentina imposed an obligation to show the origin of funds used to buy foreign currencies and to obtain authorization from the tax authorities as a way of moderating the high demand for dollars. The result was a major drop in retail demand for cash, which reduced pressure on the Central Bank. In Venezuela, the amount authorized for imports was increased by 19.3% y/y in the third quarter, in particular for food and medicine, items with the biggest shortages.
 

Inflation accelerates in Peru and continues high in Venezuela in October
The increase in prices in Peru (0.31% m/m) was greater than expected and accumulated inflation for the year hit 4.0% in October. Monthly inflation in Venezuela was 1.8%, and accumulated inflation for the year 22.7%.



Tax receipts up in Argentina and Brazil
Argentina announced the withdrawal of subsidies on water, gas and electricity services. Although the fiscal saving is estimated at only 0.03% of GDP, this could be the first step in the reduction of energy subsidies to the residential sector, whose annual fiscal cost is 2.2% of GDP. At the same time, tax receipts were up by 31.8% y/y. In Brazil, the tax receipts were up 14.4% y/y in September. This figure is significantly below that observed in previous years (22% y/y on average between January and August).

Some slowdown in deposit growth in Peru
Deposit growth in the private sector was 17.9% y/y in September, somewhat below the annual average (21.5%).
 

Industrial output falls again in Brazil
Industrial output in Brazil fell by 2.0% m/m in September, a negative surprise for the markets which expected a less steep fall. This has strengthened the perception that economic activity was moderating.

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