A surprising performance has taken place in a context of high volatility in New York, with Donald Trump's first measures affecting Latin America. In this scenario, the evolution of the region's stocks stands out.
The dollar in Mexico closed slightly above $19 and reached $21.30 during times of tension with the United States. Regarding monetary policy, higher rates are observed in Brazil, Colombia, and Chile, while lower rates are expected for Mexico.
Emerging market investors in New York are confident that Argentina will reach an agreement with the IMF in the second half of March. The amount of this agreement will be crucial, potentially exceeding $11 billion.
The increase in U.S. tariffs on Mexico and Canada could create opportunities for Latin American countries to export to the United States. It is anticipated that purchases of Argentine bonds and stocks could increase significantly with this new understanding.
Brazil is also experiencing renewed optimism after a period of uncertainty. Brazil's exports and those from Central American countries could benefit in the short term by redirecting their exports to the U.S.
International trade relations have become more complex, especially with Trump's fluctuating decisions. The lack of harmony between Trump and the Federal Reserve raises concerns on Wall Street. Uncertainty about potential conflicts with Mexico persists.
The Latin American market shows signs of recovery, and GDP growth of 2.2% is expected in the region. Recommendations suggest overweighting domestic stocks compared to other regional assets.
Despite the challenges, the reduction of tariffs could benefit productive sectors in Latin America and expose inefficient industries to international competition. Although uncertainties remain, a less detrimental outlook for the region is emerging than initially expected.
