Latin America News
LAST UPDATE: July 22, 2025
Trump’s Brazil Blow-Up Raises Stakes as Leftist Leaders Meet
After Trump threatened 50 % tariffs on Brazilian imports, leftist leaders at a Chile summit avoided confrontation, weighing the political risk of escalation.
Insight
The tariffs shifted regional dynamics, pressuring Brazil’s leaders to respond diplomatically and reshaping intra‑left unity to balance domestic solidarity with foreign policy pragmatism.
Brazil economists trim 2026 inflation forecast in boost for central bank
Brazilian economists revised their 2026 inflation forecast downward, reinforcing confidence in the central bank’s monetary policy targeting medium-term inflation.
Insight
The optimism suggests central bank credibility, potentially allowing interest rate cuts; however, global uncertainties like US tariffs could disrupt this positive outlook.
Brazil acknowledges possibility of no US trade deal by August 1
Brazil’s Finance Minister Haddad admitted a US trade deal may not materialize by August 1, when Trump’s 50 % tariffs on Brazilian goods would be enforced, but emphasized contingency plans and ongoing negotiations.
Insight
By preparing for adverse outcomes and reinforcing trade diversification plans, Brazil shows resilience, but delayed US resolution could shock its export sectors and stress diplomatic ties.
Firms See Canada Escaping Worst Tariff Outcomes, Survey Shows
According to a Bloomberg report, about half of Canadian firms are already facing increased costs from tariffs but expect to largely sidestep the worst-case scenarios, as per the Bank of Canada’s Business Outlook Survey.
Insight
This highlights Canadian businesses’ resilience: they are adapting via supplier shifts and cost management and remain cautiously optimistic despite tariff-driven headwinds.
Canada Producer Prices Rise 0.4% in June
Statistics Canada data shows the producer price index rose 0.4% month-over-month in June, the ninth consecutive monthly rise, with notable increases in non-ferrous metals, meat, fish, and dairy.
Insight
Persistent industrial inflation reflects ongoing cost pressures that could impact corporate margins, though policymakers retain room to maneuver amid benign consumer inflation.
Colombia Firms Warn of Layoffs and Rising Costs From Petro’s Labor Overhaul
Colombian industrial and service firms warn that President Petro’s proposed labor reforms—raising wages and social contributions—could force layoffs amid increased operating costs.
Insight
The reforms aim at social equity but risk triggering economic slowdown and higher unemployment if firms reduce staff to contain costs.
Chile Spreads on Track to Hit a 15-Year Low as Elections Loom
Chilean sovereign bond spreads have tightened to their lowest levels in 15 years relative to U.S. Treasuries, reflecting high market confidence ahead of upcoming elections.
Insight
The narrowing spreads signal strong investor faith in fiscal stability, giving the next government flexibility—but a deviation from fiscal prudence could reverse gains.
Mexico sees no reason for US to impose sanctions on airlines
Mexico’s president said no formal notification of U.S. sanctions against Mexican airlines has been received and sees no justification for them, following U.S. competition concerns around Mexico City’s airports.
Insight
His response aims to calm sector fears and preserve Mexico‑U.S. aviation ties, which are integral to trade and connectivity under the looming USMCA review.
Venezuela to probe migrant ‘torture’ in Salvadoran prison
Venezuela’s attorney general will investigate claims that over 250 Venezuelan migrants deported from the U.S. were tortured—including beatings, sexual violence, and neglect—in El Salvador’s CECOT prison.
Insight
The investigation may escalate diplomatic tensions and draw attention to human rights issues in migration policy, possibly influencing future deportation practices.
