Bladex Weekly LatAm Insight

Economic Studies Department

_{Sergio Olarte | Gustavo Acero}

Our Weekly LatAm Insights, prepared by Bladex’s Economic Studies team, provide a weekly overview of the main macroeconomic developments in Latin America and the international environment, highlighting trends that may impact the region’s economic performance.

Key Takeaways of the Week

• Fiscal accounts remain front and center. Panama has narrowed its deficit, although the earthquake is creating new fiscal pressures, while Honduras is moving toward the final disbursement under its IMF program. Meanwhile, Moody’s has warned about El Salvador’s high debt burden, which is projected to exceed 90% of GDP in 2027. In Costa Rica, the rejection of the electricity reform has stalled the planned changes to the sector.
• Signs of an economic slowdown are emerging, while El Niño is adding further pressure. Argentina is nearing the risk of a technical recession amid weakness in key sectors; Colombia surprised with a contraction in economic activity and has no room for countercyclical policy; and Ecuador and Peru face mounting pressure on their 2027 budgets due to El Niño and subsidies.
• Risk aversion is once again setting the tone in financial markets. The correction in AI-related stocks boosted demand for Treasuries and pushed yields lower, even as oil prices remained above US$112. At the same time, crude oil flows from the Persian Gulf recovered, albeit at higher logistics costs, while corporate earnings sent mixed signals.

Read the full report here: Bladex Weekly LatAm Insight