LATAM DAY AHEAD-Latin American News and Indicators (December 23)

FRIDAY’S AGENDA UNITED STATES – The Department of Commerce publishes the report on consumption, which represents more than two-thirds of the country’s economic activity. Analyst estimates indicate a 0.2% increase in November after the 0.8% jump in October. -The Department of Government also releases data on durable goods orders for November. BRAZIL – The local statistics agency, Igbe, presents the change in the IPCA-15 inflation index for December. MEXICO – The INEGI National Institute of Statistics publishes data on the trade balance and economic activity in November. GLOBAL MARKETS UPDATE RUSSIA – Moscow could cut its oil output by 5-7% in early 2023, in response to price caps on its crude and refined products, and halt sales to countries that support them, he told the state television Deputy Prime Minister Alexander Novak. Describing for the first time the Russian response to price caps introduced by the West in the wake of Russia’s invasion of Ukraine, Novak said the cuts could reach between 500,000 and 700,000 barrels per day (bpd). USA- The Congressional committee investigating the January 6, 2021 attack on the US Capitol has released its final report, setting out its arguments for former US President Donald Trump to face criminal charges for inciting violence. riot, which resulted in fatal casualties. The House Select Committee also released transcripts of several of its interviews and witness testimony on Thursday and Wednesday. JAPAN – Core consumer inflation hit a new four-decade high as firms continued to pass rising costs onto households, the data showed, a sign that price hikes were spreading and could underpin economic growth. central bank under pressure to reduce its massive stimulus. Months before Tuesday’s surprise adjustment to its policy to control debt yields, Bank of Japan officials had discussed the possible impact on the market of a future exit from ultra-low interest rates, minutes of the meeting showed. October. CHINA – The country expects a spike in COVID-19 infections within a week, a health official said, and authorities expect an additional burden on China’s health system, even as they downplay the severity of the disease and continue to report no new deaths. Facing an escalating outbreak and widespread protests against its “COVID zero” lockdown and testing regime, China began dismantling it this month, becoming the latest major country to live with the virus. CHILE – An uncontrolled forest fire devastated more than 200 homes in the Chilean coastal city of Viña del Mar as firefighters worked to control the rapid advance of flames, which would have claimed the lives of two people, the Undersecretary of the Interior said. The government of President Gabriel Boric has decided to decree a state of exceptional catastrophe for public disaster in the area, which allows him to more easily mobilize resources, as well as limit the rights of assembly and relocation. WHAT TO KNOW ABOUT THURSDAY’S US WEATHER – A dangerously freezing Arctic airmass blanketed a large swath of the United States ahead of what could be one of the coldest Christmas days on record, as a winter storm threatened to wreak havoc travel plans for millions of Americans. Heading into the holiday weekend, the impending storm was expected to bring blizzards to the Great Lakes region, up to 2 inches of rain followed by flash freezes on the East Coast, wind gusts of 100km/h and bitter cold to the border with Mexico. US ECONOMY – The number of Americans filing new jobless claims rose less than expected last week, indicating a still-tight job market, as the economy recovered faster than previously estimated in the third quarter. Initial claims for state unemployment benefits rose 2,000 to 216,000 at the seasonally adjusted level for the week ended Dec. 17, the Labor Department said. Economists polled by Reuters had forecast 222,000 questions for last week. INFLATION MEXICO- General inflation in Mexico rebounded in the first half of December after six fortnights of moderation, even when the underlying variable stopped its rapid progression, reinforcing expectations that the central bank will continue with its tightening cycle. The price index stood at 7.77% at the interannual rate, higher than the 7.46% recorded in the second half of November, according to data released by the statistical institute. MEXICO ECONOMY- A recession or slowdown in the US economy could hamper Mexico’s Gross Domestic Product (GDP) growth, said one of the board members of the Latin American country’s central bank, Banxico. The US economy, which accounts for 80% of Mexico’s exports, grew 3.2% in the third quarter, according to official data, above a previous estimate of 2.9% growth. However, a widespread fear of a recession next year has gripped the market, as a consequence of a tightening by the Fed. COLOMBIA ECONOMY- Colombia has revised its economic growth forecast for 2023 to 1.3% from an earlier 1.8%, while it expected a lower-than-expected fiscal deficit, which will comply with the fiscal rule, the Finance Ministry said. The fourth largest economy in Latin America is projected to accumulate an 8.2% expansion over the course of 2022, higher than the 7.7% previously forecast. RUSSIA’S OIL – Exports of Russia’s Ural crude mix from Baltic Sea ports could fall by up to a fifth in December, after a Western price cap and an EU purchase ban on Russian oil come into effect , according to traders and Reuters calculations. Traders say Russia has been unable to fully redirect Ural exports from Europe to other markets, especially India and China, and has struggled to find enough suitable vessels. (Reuters RF)