- In Chile, economic activity up 5.7% y/y in September, slightly above expectations
- Recent inflation surprises cool interest rates down
- Unemployment remains stable in Venezuela (8.3%)
- Consumer confidence falls in Colombia, business confidence increases in Peru
- Liquidity falls in Argentina, in Peru the Central Bank maintains its interest rate
Growth was 4.8% y/y in Q3, down on the figure of 6.8% in Q2. In Brazil, retail sales were strong in September (0.6% m/m), but GDP should grow by 0.2% q/q in Q3, substantially under the figure of 0.8% q/q in Q2. In Colombia, vehicle sales increased by 10.1% y/y in October, the highest figure ever for the period. However, there was a fall of 1.3% m/m, in line with the expected slowdown in consumption of durable goods.
In Chile October inflation stood at 3.7% y/y, mainly due to increased prices in tradable goods. In Colombia, inflation was 4.0% y/y, boosted by food prices and the low basis of comparison with October 2010. In Mexico, inflation was 3.2% y/y, with major movements in food & drink and energy prices. In contrast, a reduction of up to 7% y/y is expected in Brazil.
Meanwhile, wages increase, including a rise in the minimum wage (10%) and improved salaries for doctors, teachers and civil servants. These policies were reflected in an increase in the Remuneration Index of 36% y/y, above the inflation figure for September. As a result, the index also increased in real terms. The unemployment rate for September remained unchanged with respect to August and fell by barely 0.1 pp compared with the same month last year (8.4%), despite the economic recovery in 2011 against 2010.
Liquidity falls in Argentina, in Peru the Central Bank maintains its interest rate
In Argentina, the slowdown in deposits continued (in ARS, 0.2% m/m vs. 0.8% in September; in USD, 1.7% m/m vs. 3.6%). However, as credit has continued to grow strongly (up 3.2% m/m), the liquidity of the system fell more. Despite this, the Central Bank is still not renewing all its bond maturities. In Peru, the Central Bank maintained the interest rate at 4.25% for the sixth month in a row, due to risks associated with the European crisis.