Latin America News
LAST UPDATE: July 25, 2025
Mexico’s Inflation Slows in Early July
Mexico’s headline inflation slowed to 3.55 % year‑on‑year in early July, down from 4.51 % in June. In the first half of July prices rose just 0.15 %, below expectations. The Bank of Mexico had cut its benchmark rate 50 bps in June to 8.5 %, lowest since August 2022 (Reuters).
Insight
The sharp deceleration into the target zone strengthens the policy case for further rate cuts. It suggests inflation pressures are easing, giving the central bank scope to support economic growth while monitoring core price trends.
Canada Retail Sales Look to Rebound After 1.1% Drop in May
Canadian retail sales declined 1.1 % in May to CAD 69.2 billion as consumers cut auto, grocery, convenience store, and alcohol spending. Early estimates point to a 1.6 % rebound in June (Reuters, BNN Bloomberg, Bloomberg.com).
Insight
The bounce‑back indicated for June suggests the May drop was temporary and auto‑related. Consumer spending remains fragile, vulnerable to tariff uncertainty and policy shifts, but not showing broad weakness.
IMF says El Salvador’s bitcoin holdings are consistent with program commitments
The IMF confirmed that El Salvador’s bitcoin holdings remain within the limits set by its IMF‑backed program. Holdings reflect intra-government wallet movements and comply with agreed‑upon thresholds (TradingView, MarketScreener).
Insight
Despite political controversy over crypto use, the IMF views current bitcoin exposure as compliant—emphasizing the importance of transparency and controlled exposure within broader fiscal arrangements.
Discussions on IMF review of Argentina program are ‘very advanced,’ agreement could happen ‘very shortly’
IMF communications director Julie Kozack said that the first review of Argentina’s $20 billion program with the Fund is at a “very advanced” staff‑level stage, with a deal expected “very, very shortly” (TradingView).
Insight
Argentina appears to be meeting reform progress targets under its new program. A near‑term agreement would help unlock disbursements and reinforce investor confidence in its fiscal policy trajectory.
Brazil and Mexico Eye More Trade as Trump Tariffs Loom
Facing looming U.S. tariffs (including 50 % on select goods), Brazil and Mexico are ramping up regional trade ties to mitigate risk and diversify markets ahead of U.S. policy deadlines (Bloomberg.com, news.bloomberglaw.com).
Insight
Both countries are proactively hedging against escalating U.S. protectionism by deepening trade within Latin America. The push reflects efforts to build supply‑chain resilience amid geopolitical uncertainty.
Brazil ready to negotiate with Trump if he wants, Lula says
President Luiz Inácio Lula da Silva said Brazil remains ready to negotiate with Donald Trump on trade issues, but noted Trump has not reached out, implying lack of interest from the U.S. side (TradingView, Reuters).
Insight
Lula’s remarks position Brazil as open and reasonable, while highlighting frustration with U.S. inaction. It underscores a preference for dialogue over confrontation, albeit on equal terms.
Brazil’s top court rules out Bolsonaro arrest after ‘isolated’ restriction breach
Brazil’s Supreme Court ruled on July 24, 2025 that former President Jair Bolsonaro will not be arrested for a single “isolated” violation of court‑imposed restrictions (social media ban, ankle monitor), though future breaches may trigger detention (Reuters, Reuters).
Insight
The decision strikes a tentative legal balance—upholding enforcement without escalating. It signals judicial restraint while preserving the possibility of action if Bolsonaro violates orders again.
US prepares to allow limited oil operations in Venezuela, starting with Chevron, sources say
The Trump administration will permit Chevron and select partners to resume limited oil operations in Venezuela following a prisoner exchange, allowing partial revenue flows without formal recognition of Maduro’s government (washingtonpost.com, Reuters).
Insight
A strategic shift: it balances economic engagement with geopolitical caution. Chevron’s re-entry could ease cash flow and migration pressures while maintaining U.S. sanctions posture.
S&P Global lifts Pakistan’s credit rating ‘B-‘ from ‘CCC+’, outlook stable
S&P upgraded Pakistan’s sovereign rating to B‑ with a stable outlook, citing improved fiscal stability, rising reserves, and IMF‑backed support. Pakistani bond prices rallied accordingly (Reuters).
Insight
The upgrade reflects confidence in Pakistan’s IMF-led stabilization and revenue reforms. It may lower borrowing costs, attract investors, and support ongoing macro recovery.
