☀ Domingo Brief — Maduro Steals the Vote

Each Sunday, take two minutes to catch key stories and opportunities shaping Latin America.

Welcome back to the Domingo Brief! This week, we’re keeping up with the Venezuelan election process, Peruvian FX markets, and more.

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Trivia of the Week

A little over a third (37%) of you correctly guessed Colombia as the Andean country which does not have a signed free-trade agreement (FTA) with China. Both Chile and Peru signed FTAs with China, their largest trade partner, in the 2000s. Ecuador just implemented its own FTA with China last year.

Each week, tune back in for the answer to the previous week’s trivia question. No cheating!

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🇦🇷 Argentinian Central Bank reserves have decreased by $1.9B as President Javier Milei’s battle to prop up the peso continues. While the government justified the decrease as payment for international debts, bonds, and fuel imports, investor sentiment has worsened as the central bank drains the market of local currency by buying sovereign bonds in dollars and selling them in pesos. Current cash settlement exchanges after the initial intervention in July have decreased to 1,207 pesos per dollar from 1,405 pesos per dollar, indicating a slow, but positive result.

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🇧🇷 Brazil’s benchmark interest rate remains unchanged following the second consecutive central bank policy meeting. Copom, the central bank’s rate-setting committee, held the benchmark interest rate at 10.5% but emphasized the need for more focused market vigilance due to increasing inflation expectations. Year-over-year inflation projections for 2024 increased to 4.1% from the policy target of 3%, so there is an approaching likelihood that rates might soon be increased due to slow rising prices.