LATAM Summary – January 26

• Brazil mid-month IPCA inflation and Mexico trade are the data highlights in LatAm on Friday. In Chile, the BCCh will also publish its latest traders survey, with attention on market expectations for next week’s policy rate meeting. In the US, the monthly PCE report for December will be the focus as the last key data release ahead of next week’s FOMC meeting.

Global News:

• ECB (MNI ECB WATCH) – The European Central Bank kept its key interest rate on hold at 4% on Thursday for a third consecutive meeting, with President Christine Lagarde saying it was too early to discuss the timing of cuts but repeating that she saw no reason to disagree with a growing consensus for easing to begin by the summer.
• US (MNI BRIEF) – U.S. GDP grew at a faster-than-expected 3.3% annual rate in the fourth quarter of 2023, driven by consumption growth at 2.8%, underscoring the resilience of the economy even as interest rates rose sharply. Wall Street had expected growth of 2.0%, down from a very hot 4.9% in the third quarter.
• JAPAN (RTRS) – Bank of Japan policymakers actively debated in December the conditions for phasing out stimulus, and agreed to deepen discussions on the appropriate pace of future interest rate hikes, minutes of the meeting showed, a sign they were gearing up for a near-term exit from negative interest rates.