Still struggling

Financial markets across Latin America have fared well over the past month but the incoming economic data suggest that the region is still struggling. Most of the attention has, of course, focussed on Brazil, where the political crisis is spiralling. There are early signs that this is pushing the economy deeper into recession. Consumer confidence fell sharply this month, having improved in January and February. But although Brazil’s problems are especially acute, the economic data from other parts of Latin America have been weak too. First-quarter GDP growth is shaping up to be pretty lacklustre in Mexico and Chile. And while Colombia’s economy has so far remained relatively resilient, a deepening power crisis is likely to supress activity in the months ahead. So while financial markets have ended the first quarter on a high, there has been little to cheer in the economic news from Latin America.