Latin America economic news summary

HOUSTON (ICIS)–Here are the economic news stories on the Latin America region for the week ended 18 May:

Brazil’s March producer price index rose by 1.05% month on month, putting the 12-month total at 6.23%, the Brazilian state statistical agency (IBGE) said on 26 April. Chemical products registered as one of the industrial sectors that showed the most uptick month on month rising by 2.86%. In the chemicals tier, polypropylene (PP) and herbicides both influenced the higher pricing in the sector in March, IBGE said.

Brazil’s trade deficit in chemical products in the first quarter reached $5.6bn, up by 12.5% compared with the same period in 2017 as rising prices offset lower import volumes, trade group Abiquim said on 24 April.

Mexico’s central bank maintained its benchmark interest rate unchanged at 7.5% on 17 May amid uncertainty stemming from the North American Free Trade Agreement (NAFTA) and the Mexican peso. The bank said the current rate should help inflation fall back to its 3% target and that it was closely following potential inflation pressures from a weaker peso.

The peso has tumbled close to 5% this month to its weakest in more than a year, largely because of a stronger dollar. The central bank said “domestic factors” also weakened the currency. Mexican policymakers said the peso could be further hurt by uncertainty about Mexico’s presidential election on 1 July, as well the renegotiation of NAFTA.

Mexico’s producer price index (PPI) declined by 0.04% in April month on month, the state statistical agency INEGI said on 9 May. For the year it rose by 4.00%.  The figures exclude petroleum. By sector, producer prices for chemicals dropped by 1.20% month on month but were up by 5.33% for the year. Plastic and rubber products were down by 0.12% month on month but were up by 3.96% for the year. Petroleum products were up by 0.83% month on month and up for the year at 14.37%, INEGI said.

Mexico’s industrial production in March was steady year on year and also stable from the previous month, the state statistical agency (INEGI) said on 11 May.

Statistical agency (INEGI) expects the Mexico’s economy grew by 1.1% in the first quarter from the fourth, it said on 30 April. Year on year, GDP likely grew by 2.4%.

Mexican vinyls producer Mexichem reported on 25 April a Q1 net income of $79m, up 52% from $52m from the same time last year because of higher sales. First-quarter sales were $1.76bn, up 27% from $1.39bn from the same time last year.

Sales rose because of fluorspar demand as well as better prices for Mexichem’s fluorine-based products and for its PVC.