Brazil and Mexico to come out worst

The downturn in Latin America this year will the deepest since reliable records began. The slow policy responses in Brazil and Mexico, as well as struggles to bring their coronavirus outbreaks under control, suggest that the economic consequences will be more severe there than in Chile, Peru and Colombia. Our forecasts for GDP growth are generally more downbeat than the consensus’ and the IMF’s. Meanwhile, the fiscal costs of the crisis may prompt Mexico’s government to stop supporting the national oil company, Pemex, and are pushing Argentina’s government towards a disorderly debt default.