New virus cases have jumped almost five-fold in Latin America over the past two weeks as the contagious Omicron variant is taking hold, but there are reasons to think that the economic fallout will be limited. Otherwise, the surprise 200bp rate hike delivered by Argentina's central bank this week is a tentative shift towards more orthodox monetary policy, which we think is a sign that the authorities are working towards a new IMF deal. Finally, the relatively minutes to Banxico's December meeting suggest that last month's 50bp rate hike will not be a one-off.
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