Latin America News
LAST UPDATE: July 19, 2025
Brazil’s Growth Faces Hard Limits as Debt and Inflation Bite
The IMF forecasts Brazil’s GDP growth will slow to 2.3% in 2025, down from 3.4% in 2024, citing persistent inflation and rising public debt as constraints. (The Rio Times, IMF)
Insight
Brazil’s somewhat resilient growth is being undermined by macroeconomic imbalances. High inflation and heavy debt burdens limit fiscal and monetary flexibility, risking slowed consumption and investment unless structural reforms tackle these pressures.
Tariff hike to have limited impact on (Brazil’s) GDP, IMF executive director says
According to a note from FGV Agro, the proposed U.S. tariff increase (from 10% to 50%) on Brazilian goods could reduce Brazil’s GDP by about 0.41%, mainly due to declines in agribusiness exports that make up nearly 30% of Brazil’s U.S. shipments.
Insight
The limited GDP impact highlights Brazil’s export and economic diversification. Despite the 50% tariffs, Brazil may weather the shock, but key export sectors—like agriculture—will need to absorb short-term losses. Negotiations or insurance mechanisms could help mitigate this blow.
Brazil police search Bolsonaro’s home, court orders ankle monitor
Federal police searched former President Jair Bolsonaro’s residence and party HQ as ordered by the Supreme Court. He was also ordered to wear an ankle monitor, banned from social media, and restricted from foreign contact amid coup conspiracy investigations. (Reuters, Reuters)
Insight
Brazil’s Judiciary is intensifying legal actions against Bolsonaro, signaling robust institutional checks despite external political pressures—such as from Trump, who threatened tariffs if the legal processes continue.
Colombia Central Banker Flags Peso Rally Risk to Rate Outlook
A newly appointed central bank board member warned that the Colombian peso’s recent rapid appreciation may be driven by speculative inflows, complicating future rate cut plans. (Bloomberg.com, X (formerly Twitter))
Insight
The peso’s strength could limit the central bank’s ability to ease monetary policy, as a strong currency may cool inflation—but if driven by unstable capital, it could prompt volatility and require tightening instead.
Mexico’s Sheinbaum says she agrees with central bank’s rate cuts
President Claudia Sheinbaum expressed support for Banxico’s 50‑bps rate cut in late June, arguing it will boost investment. This follows a moderation in inflation after four consecutive months of rises. (Reuters, TradingView)
Insight
Sheinbaum’s endorsement reinforces a dovish monetary stance aimed at stimulating growth, but poses risks if inflation rebounds. Political backing adds credibility but also pressures central bank independence.
Canada’s steel import duties violate WTO rules, says China
China condemned Canada’s 25% tariff on steel containing Chinese-origin material as a violation of WTO rules, warning it disrupts trade and hinders bilateral relations. (Reuters, Reuters)
Insight
The dispute reflects escalating trade friction beyond U.S.‑China. Canada’s protective tariffs may spur retaliation, complicating broader multilateral trade dynamics and affecting sectors like agriculture and minerals.
Argentina Says It Won’t Negotiate With Burford Over YPF Shares
Argentina’s government affirmed it will not negotiate with Burford or other plaintiffs concerning the $16 billion award linked to YPF shares and denied any clandestine discussions. (Bloomberg.com, ブルームバーグ法ニュース, Buenos Aires Herald)
Insight
Buenos Aires is taking a public legalistic stance to resist external financial pressure. By refusing negotiation, it signals a firm commitment to uphold sovereign asset control, meaning prolonged legal battle ahead.
