contents · euro area -4.2 -3.7 -3.0 -2.6 -2.3 0.1 1.4 2.2 2.4 2.4 ... the release of new economic...

© FocusEconomics 2014ISSN 2013-648X

FOCUSECONOMICSEconomic Forecasts from the World’s Leading Economists

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LATIN FOCUS CONSENSUS FORECAST

ContentsSummary ...................................................... 3

Calendar ..................................................... 19

Argentina .................................................... 20

Brazil ........................................................... 33

Chile ............................................................ 47

Colombia .................................................... 61

Mexico ........................................................ 74

Peru............................................................. 89

Venezuela ................................................. 100

Other Countries ....................................... 110Bolivia .................................................. 110

Ecuador ............................................... 113

Paraguay ............................................. 116

Uruguay ............................................... 119

Notes......................................................... 125

. .

April 2014

Next edition: 13 May 2014

Publication date: 15 April 2014

Information available: up to and including 14 April 2014

Forecasts collected: 7 April - 11 April 2014

Arne Pohlman Armando Ciccarelli Ricard Torné Carl Kelly Teresa KerstingChief Economist Head of Research Senior Economist Economist Economist

Miriam C. Dowd Ricardo Aceves Dirina Mançellari Enrique Jorge Olga CoșcodanEditor Senior Economist Economist Economist Economist

..

FOCUSECONOMICS Summary

LatinFocus Consensus Forecast | 2

April 2014

Forecast Summary | Major Economies and Latin America

Gross Domestic Product, ann. var. in %

Fiscal Balance, % of GDP

Consumer Prices, ann. var. in %

Current Account Balance, % of GDP

2011 2012 2013 2014 2015 2011 2012 2013 2014 2015World -4.7 -4.3 -3.4 -2.9 -2.5 0.0 0.0 0.0 0.0 0.0

United States -8.3 -6.7 -4.0 -3.0 -2.7 -2.9 -2.7 -2.3 -2.1 -2.1Euro area -4.2 -3.7 -3.0 -2.6 -2.3 0.1 1.4 2.2 2.4 2.4Japan -9.6 -9.8 -10.1 -7.9 -6.7 2.1 1.0 0.7 0.7 1.1China -1.1 -1.7 -1.9 -1.9 -1.9 1.9 2.3 2.0 2.3 2.2Latin America -2.2 -2.9 -3.2 -3.5 -3.3 -1.3 -1.8 -2.4 -2.4 -2.2

Centam & Caribbean -2.6 -10.6 -10.0 -9.9 -9.9 -2.9 -2.9 -1.8 -2.2 -2.4Chile 1.5 0.6 -0.6 -0.9 -0.7 -1.2 -3.4 -3.4 -3.6 -3.2Mexico -2.4 -2.6 -2.3 -3.6 -3.1 -1.1 -1.2 -1.8 -1.9 -2.0

Mercosur -2.6 -2.8 -3.3 -3.4 -3.2 -1.0 -1.5 -2.4 -2.2 -1.9Argentina -1.6 -2.5 -2.5 -2.7 -2.6 -0.5 0.0 -0.8 -0.3 -0.3Brazil -2.6 -2.5 -3.3 -3.8 -3.5 -2.1 -2.4 -3.6 -3.4 -3.1Paraguay 0.7 -1.8 -1.9 -0.9 -0.4 0.4 -0.9 2.1 0.8 0.2Uruguay -0.6 -2.0 -1.6 -2.4 -2.0 -2.9 -5.3 -5.6 -3.8 -3.8Venezuela -4.0 -4.9 -4.8 -2.5 -2.7 7.7 2.9 2.9 2.2 2.5

Andean Com. -0.5 -0.4 -1.3 -1.4 -1.2 -2.2 -2.4 -3.3 -3.2 -3.0Bolivia 0.8 1.8 0.1 -0.1 0.0 0.3 8.6 4.2 3.8 2.6Colombia -2.0 -1.9 -2.2 -1.9 -1.8 -2.9 -3.2 -3.4 -3.5 -3.3Ecuador 0.0 -0.9 -2.6 -2.8 -2.5 -0.3 -0.4 -1.4 -1.3 -1.2Peru 1.9 2.1 0.8 0.1 0.1 -1.9 -3.3 -5.0 -4.7 -4.0

Fiscal Balance, % of GDP Current Account, % of GDP

2011 2012 2013 2014 2015 2011 2012 2013 2014 2015World 3.2 2.6 2.5 3.1 3.5 3.8 2.8 2.6 2.9 3.0

United States 1.9 2.8 1.9 2.8 3.0 3.1 2.1 1.5 1.7 2.0Euro area 1.6 -0.6 -0.4 1.1 1.5 2.7 2.5 1.4 1.0 1.4Japan -0.5 1.4 1.5 1.3 1.3 -0.3 0.0 0.4 2.5 1.6China 9.3 7.7 7.7 7.4 7.3 5.4 2.6 2.6 3.0 3.1Latin America 4.2 2.9 2.6 2.3 3.0 7.1 6.1 8.5 10.7 9.3

Centam & Caribbean 3.1 3.4 3.0 2.9 3.1 5.3 4.1 3.5 4.0 4.0Chile 5.8 5.4 4.1 3.5 4.1 4.4 1.5 3.0 3.1 3.1Mexico 4.0 3.9 1.1 3.1 3.9 3.8 3.6 4.0 3.9 3.5

Mercosur 3.8 1.7 2.4 1.2 1.9 8.9 8.3 12.7 16.9 14.7Argentina 8.9 1.9 3.0 0.1 1.2 9.5 10.8 11.0 27.8 27.9Brazil 2.7 1.0 2.3 1.8 2.1 6.5 5.8 5.9 6.2 5.8Paraguay 4.3 -1.2 13.6 4.8 4.3 4.9 4.0 3.7 5.0 5.0Uruguay 7.3 3.7 4.4 3.4 3.6 8.6 7.5 8.5 8.6 7.6Venezuela 4.2 5.6 1.5 -1.2 1.5 27.6 20.1 56.2 58.8 48.5

Andean Com. 6.8 4.9 4.5 4.7 4.9 4.3 2.8 2.5 3.1 3.1Bolivia 5.2 5.2 5.9 5.3 4.7 6.9 4.5 6.5 5.4 4.9Colombia 6.6 4.0 4.3 4.5 4.6 3.7 2.4 1.9 3.0 3.1Ecuador 7.8 5.1 3.9 3.9 4.0 5.4 4.2 2.7 3.5 3.3Peru 6.9 6.3 5.0 5.4 5.6 4.7 2.7 2.9 2.7 2.6

Real GDP, annual variation in % Consumer Prices, annual variation in %

-2

0

2

4

6

8

World United States Euro area Japan China Latin America

2012 2013 2014 2015

-12

-9

-6

-3

0


2012 2013 2014 2015

-3

0

3

6

9

12


2012 2013 2014 2015

-4

-2

0

2

4

United States Euro area Japan China Latin America

2012 2013 2014 2015



April 2014

SummaryThe 2014 economic outlook for Latin America deteriorated again this month and thus continued on the downward trend that began a year ago. LatinFocus Consensus Forecast panelists cut the region’s GDP growth projection for 2014 from the 2.5% increase expected in March to 2.3%. At the current rate, the region will experience a slight deceleration compared to the 2.6% increase that is estimated for 2013. This month’s downward revision was the result of a sizable cut to the growth forecast for Argentina, as well as lower projections for Chile, Mexico and Venezuela. Projections were left unchanged for Bolivia, Brazil, Colombia, Ecuador and Peru, while growth prospects improved for Paraguay and Uruguay. Panelists expect the region’s GDP to accelerate to a 3.0% expansion in 2015 due to support from stronger global demand and the key structural reforms that some countries have implemented.

Panelists have observed near-term downside risks to the global outlook in recent weeks, which stem from a number of factors including the possibility that the Chinese economy may decelerate, geopolitical tensions in Ukraine, and increasing concerns over the real state of Japan’s economic recovery.

Following a State Council meeting, the Chinese government announced a number of measures that are designed to stimulate economic growth on 2 April. The measures are modest in terms of stimulus scale and focus mainly on railway construction, funding for housing, and extending small business tax relief. The announcement was made along with the release of new economic data, which continue to suggest that economic momentum has slackened in recent months.

The Ukrainian crisis continued to dominate headlines over the past month. After Russia annexed the Crimean Peninsula, the West, led by the United States, announced a series of sanctions that mainly target individuals who are assumed to be close to the Putin administration. The West stated that sanctions would increase in response to further Russian aggression. Recent developments suggest that Moscow is now more likely to use economic tools to achieve its political goals in Ukraine versus carrying out a direct military assault on its neighbor.

In Japan, concerns are mounting regarding both the state of the country’s economic recovery and the true success

Regional outlook deteriorates

Change in 2014 GDP Growth Forecast

-0.6 -0.4 -0.2 0.0 0.2

Argentina

Venezuela

Chile

Mercosur

Latin America

Mexico

Colombia

Brazil

Andean Com.

Peru

Ecuador

Bolivia

Uruguay

Paraguay

.Source: LatinFocus Consensus Forecast.Note: Change between April and March 2014 in percentage points.



April 2014

of Abenomics. Recent GDP data showed that the economy failed to pick up speed in the last quarter of 2013, while more recent data continues to send mixed signals. In an effort to tackle Japan’s ballooning public debt, the government raised the sales tax from 5.00% to 8.00% on 1 April. This is the first tax increase of its kind in 17 years. Most analysts believe that the tax hike will dampen economic activity in the coming months.

In Latin America, industrial production data for Brazil showed that output expanded a seasonally-adjusted 0.4% over the previous month in February following a 3.8% expansion in January. In year-on-year terms, growth in industrial production bounced back from a 2.4% contraction in January to a 5.0% expansion in February, which partially reflected the fact that the Carnival holiday took place in February last year but in March this year. Most analysts agree, however, that industrial production data was volatile and thus did not reflect a consistent recovery in the industrial sector. March business sentiment confirmed that firms are pessimistic regarding both the current economic situation and economic prospects. As a result, lackluster growth in industrial production and in investment is expected to continue. On the external front, the current account deficit was narrower than expected in February, although the deficit over 12 months did widen.

On a negative note, severe weather conditions are putting additional pressure on Brazil’s food and energy prices. Persistently low rainfall and high demand for energy have lowered reservoirs in the country’s hydroelectric power plants to critical levels. Although most analysts believe that the government should adopt energy rationing as a pre-emptive measure for the time being, the government is likely to try to avoid doing so in order to mitigate political costs ahead of October’s presidential election. On 24 March, credit ratings agency Standard & Poor’s (S&P) downgraded Brazil’s long-term sovereign rating from BBB to BBB-. The downgrade reflects a deterioration in public accounts, uncertainty regarding the government’s fiscal policy, and subdued economic growth. The downgrade had an impact on the already-low popularity of Dilma Rousseff’s leftist government. LatinFocus Consensus Forecast panelists expect Brazil’s GDP to increase 1.8% in 2014, which is unchanged from last month’s forecast. In 2015, the economy is expected to grow 2.1%.

In Mexico, January data showed that the economy had a weak start to the year. Economic activity increased a paltry 0.8% year-on-year in January, which came in below the 1.1% expansion observed in December. The moderate increase reflected a slight improvement in manufacturing, while a contraction in agriculture dragged on growth. The latest indicators, nevertheless, continue to suggest that a recovery may be under way. The trade balance surplus was larger than expected in February due to strong growth in exports



April 2014

and in March, the IMEF manufacturing indicator rose to 52.7 points—the highest level in 19 months. After stabilizing in February, consumer confidence rose notably in March.

On 21 March, in compliance with the energy reform that was approved in December 2013, state-owned Petroleos Mexicanos (Pemex) presented the Energy Ministry with the “Round Zero” list of oil fields in which it would like to continue operating when the energy market is open to private investment. The move marked the first concrete step toward ending Pemex’s 75-year monopoly on Mexico’s energy sector. The Energy Ministry and the National Hydrocarbons Commission (CNH) will have six months to review Pemex’s wish list and assess whether the energy firm has the technical, financial and capacity resources required to operate the fields it has selected, or whether private sector participation will be required.

LatinFocus Consensus Forecast panelists lowered Mexico’s growth prospects for 2014 from the 3.2% that was expected last month to 3.1%. Next year, as the U.S. economy is expected to recover and the initial impact of the reforms is likely to lift economic growth, panelists expects Mexico’s economic growth to pick up to 3.9%.

In Chile, economic activity is still weak despite February’s mild increase. The current downward trend is mainly attributable to a deterioration in investment growth, especially in the mining sector. The current downward risks to the mining sector are related to a deceleration in the Chinese economy and pessimism within the Chilean business community, which reacted negatively to the fiscal reform. The reform that newly-elected Michelle Bachelet unveiled on 31 March is aimed at funding the education reform that she pledged to undertake during her campaign. The government expects to raise USD 8.2 billion annually in fiscal revenues (approximately 3.0% of GDP) by 2018 with the reform, mainly by raising corporate taxes and removing the taxable profit fund (FUT).

In Latin America, higher inflationary pressures reappeared in the first quarter and, consequently, regional inflation expectations rose again. LatinFocus panelists revised their inflation projections upward this month and now project the regional average to close 2014 at 10.7%, which is 0.7 percentage points higher than last month’s forecast. At this forecast rate, inflation will close the year in double-digits for the first time since 2002. For 2015, forecasters also raised their inflation projections from March’s 8.5% to 9.3%. On the monetary policy front, the only country that did not stay put was Brazil. The Brazilian Central Bank continued its tightening policy and hiked the SELIC rate by 25 basis points in April to 11.00%.

Ricardo AcevesSenior Economist

Change in 2014 Inflation Forecast

-2 0 2 4 6

Venezuela

Paraguay

Mexico

Uruguay

Ecuador

Colombia

Andean Com.

Peru

Chile

Bolivia

Brazil

Latin America

Mercosur

Argentina

.Source: LatinFocus Consensus Forecast.Note: Change between April and March 2014 in percentage points.



April 2014

The 2014 outlok for Latin America deteriorated for the 12th consecutive month inApril, reflecting a sizeable cut to Argentina's GDP forecasts and downwardrevisions to Chile, Mexico and Venezuela. Projections for five of the eleveneconomies surveyed, including the region's largest economy Brazil wereunchnaged over the previous month.

GDP 2.3 ↓ 3.0 ↓

The regional inflation forecast for 2014 rose to 10.7% (March: 10.0%), reflecting anotable increase in Argentina's projections. In addition, panelists revised up theirinflation forecasts for Bolivia, Brazil, Chile and Colombia. For 2015, panelistsalso raised their regional inflation prospects and now expect it to end the year at9.3% (January: 8.5%).

Inflation 10.7 ↑ 9.3 ↑

According to preliminary GDP figures, the Argentine economy expanded 3.0% in2013. The reading—based on a new methodology to calculate GDP that shifts thebase year of calculation from 1993 to 2004—sets official GDP figures in line withindependent analysts’ estimates. The release sparked controversy amonginvestors as it fell short of the 3.2% growth that would have triggered payment onGDP warrants. Amid stagnating growth and rampant inflation, the government isfacing mounting social unrest as a general strike organized by the trade unionsbrought the country to a virtual standstill on 10 April.

GDP 0.1 ↓ 1.2 ↓

Consumer prices rose 3.4% over the previous month in February. Inflation 27.8 ↑ 27.9 ↑

In January, economic activity increased 6.1% over the same month of last year,which was down from the record high 10.3% expansion registered in December.January’s increase was driven by higher growth in the oil and gas industry,whereas output in most other sectors decelerated. On 4 April President EvoMorales signed a law which creates a new framework for foreign investment inBolivia. While the new law seeks to encourage foreign investment and provideguarantees to international firms, it prioritizes domestic development and givesprecedence to national norms over international courts in case of arbitration.

GDP 5.3 = 4.7 =

Annual inflation inched down from 6.2% in February to 6.1% in March. Inflation 5.4 ↑ 4.9 =

Industrial output expanded 0.4% over the previous month in February (January:+3.8% month-on-month). On 24 March, Standard and Poor’s downgraded Brazil’srating from BBB to BBB-. The agency argued that there is a certain degree ofinconsistency between its monetary and fiscal policy settings. Fiscal consolidationis currently affected by below-potential growth and off-budget activities. This isnarrowing the primary surplus.

GDP 1.8 = 2.1 =

Annual headline inflation increased from 5.7% in February to 6.2% in March. Inflation 6.2 ↑ 5.8 ↑

A powerful earthquake hit northern Chile on 8 April. The tremor destroyedthousands of homes, cut electricity and caused landslides that blocked roads insome parts of northern Chile. However, the copper industry escaped majordamages and the impact of the quake on economic activity should be limited.Meanwhile, with less than a month in office, President Michelle Bacheletpresented her tax-reform package to Parliament. The bill includes a rise in thecorporate-tax rate from 20% to 25% over the next four years to pay for increasedspending on education, one of Bachelet’s major campaign promises.

GDP 3.5 ↓ 4.1 ↓

Annual inflation rose from 3.2% in February to 3.5% in March. Inflation 3.1 ↑ 3.1 ↑

Recent polls suggest that incumbent President Juan Manuel Santos is no longerthe clear favorite in the 25 May presidential elections. While two surveys project acomfortable victory for President Santos over right-wing Oscar Ivan Zuluaga ofthe Centro Democratico party in both rounds of voting, another poll sees center-left Enrique Penalosa of the Alianza Verde party as winner in the second round ofelections. The centerpiece of President Santos’ administration has been theattempt to reach a peace accord with the FARC rebels, which he still sees aslikely to be achieved in 2014.

GDP 4.5 = 4.6 =

Annual inflation edged up from 2.3% in February to 2.5% in March. At its meetingon 21 March, the Central Bank left the policy rate unchanged at 3.25%. Inflation 3.0 ↑ 3.1 =

.

Argentina

Brazil

Chile

Colombia

Bolivia

ForecastsCurrent Developments2014 2015

Latin America



April 2014

President Rafael Correa announced that the country plans to issue approximatelyUSD 700 million of sovereign debt this year. Ecuador has not sold global bonds ininternational capital markets since defaulting on USD 3.2 billion in debt in 2008.Even though this default was followed by a restructuring process, an estimatedUSD 289 million is still outstanding. The planned bond issue will help to diversifyEcuador’s funding sources; since the 2008 default Ecuador has relied heavily onChina for financing.

GDP 3.9 = 4.0 =

In March, annual inflation rose to 3.1% from February’s 2.9%. Inflation 3.5 = 3.3 ↓

Data for economic activity in January showed that the economy started off theyear on a slow footing, but leading indicators in March suggest that growth isgradually gaining momentum. In addition, news regarding the external sector wasfairly positive. The February trade balance incurred a larger-than-expectedsurplus, due to strong export growth. On 21 March, state-owned firm Pemexsubmitted to the Energy Ministry the so-called Round Zero list of the oil fields inwhich it would like to continue operating, once the energy market is open toprivate investment. The move represents the first concrete step to end Pemex’s75-year monopoly. Changes to the by-laws of the energy reform are still underdiscussion in Congress and are expected to be approved by the end of April.

GDP 3.1 ↓ 3.9 =

Inflation fell from 4.2% in February to 3.8% in March. On 21 March, the CentralBank left the monetary policy rate unchanged at 3.50%. Inflation 3.9 = 3.5 =

The economy grew a robust 12.1% annually in the final quarter of 2013, whichwas somewhat slower than the hefty 13.7% increase tallied in the third quarter.Healthy growth in agriculture and in industry supported the Q4 expansion;services, in contrast, recorded a slight deceleration. More recent data show thatthe economy is moving to a more sustainable growth trajectory. In January,economic activity rose 6.5% annually (December: +8.5% year-on-year).

GDP 4.8 ↑ 4.3 ↓

In March, annual inflation rose to 6.1% from February’s 5.4%. Inflation 5.0 ↓ 5.0 ↑

In January, economic activity expanded 4.2% of the same month of last year. Theprint marked a deceleration from the 5.0% expansion tallied in December, thereby underlining the overall downward trend in activity. In February, the trade balancetallied a modest USD 58 million surplus, contrasting the record-high USD 679deficit in registered in January. More recent data suggest that the economy maycontinue to lose steam going forward. In March, business sentiment andconsumer confidence both moderated over the previous month.

GDP 5.4 = 5.6 ↓

Annual inflation decreased from 3.8% in February to 3.4% in March. The CentralBank decided to keep the reference rate at 4.00% at its 10 April meeting. Inflation 2.7 = 2.6 ↑

GDP expanded 4.6% in Q4 2013, which was up from the 3.0% rise seen in theprevious quarter. The economy benefited primarily from strong growth indomestic demand, whereas the external sector deteriorated. As a consequence,the economy grew a healthy 4.4% in the full year 2013, which was up from the3.7% tallied in 2012. However, in February, industrial production fell 3.1%annually, which was the second consecutive contraction.

GDP 3.4 ↑ 3.6 ↓

Annual inflation inched down from 9.8% in February to 9.7% in March. DespiteMarch’s timid drop, inflation is still the main economic policy concern and theCentral Bank reiterated its contractive stance at its 8 April Monetary Policymeeting.

Inflation 8.6 = 7.6 ↑

Following the introduction of the Second Complementary Administration Systemfor Foreign Exchange—the so-called “Sicad II”—the parallel exchange ratestrengthened slightly. The Sicad II exchange rate is currently trading at around49.0 VEF per USD, while the currency traded at around 64.3 VEF per USD in theblack market. Meanwhile, on 1 April, President Nicolas Maduro announced thatthe government is preparing a fiscal reform. Analysts believe that the reform willinclude an increase in the non-oil tax burden.

GDP -1.2 ↓ 1.5 ↓

Annual inflation edged up from 56.3% in January to 57.3% in February. Inflation 58.8 ↓ 48.5 ↑.

Peru

Venezuela

Current Developments (continued) Forecasts2014 2015

Uruguay

Mexico

Ecuador

Paraguay

Note: Arrows and equal sign denote changes in Consensus Forecast over last month.



April 2014

GDP Growth, 2014

Notes and sources

Note: Gross domestic product, real annual variation in %. Sources: National statistical institutes and central banks.

GDP per capita, 2014

Notes and sources

Note: GDP per capita in current USD.Sources: National statistical institutes and central banks.

Gross Domestic Product, annual variation in %

GDP per capita, USD

2012 2013 2014 2015 2016 2017 2018Latin America 2.9 2.6 2.3 3.0 3.4 3.7 3.7

Chile 5.4 4.1 3.5 4.1 4.4 4.5 4.5Mexico 3.9 1.1 3.1 3.9 3.9 4.0 4.0

Mercosur 1.7 2.4 1.2 1.9 2.7 3.0 3.1Argentina 1.9 3.0 0.1 1.2 2.0 3.4 3.6Brazil 1.0 2.3 1.8 2.1 2.9 3.1 3.1Paraguay -1.2 13.6 4.8 4.3 4.0 4.2 4.8Uruguay 3.7 4.4 3.4 3.6 3.7 3.8 3.9Venezuela 5.6 1.5 -1.2 1.5 2.0 2.4 2.7

Andean Com. 4.9 4.5 4.7 4.9 4.9 5.1 5.1Bolivia 5.2 5.9 5.3 4.7 4.5 4.8 5.3Colombia 4.0 4.3 4.5 4.6 4.7 4.8 4.8Ecuador 5.1 3.9 3.9 4.0 4.3 4.5 4.3Peru 6.3 5.0 5.4 5.6 5.7 5.8 5.9

2012 2013 2014 2015 2016 2017 2018Latin America 9,637 9,716 9,678 9,971 10,625 11,344 12,189

Chile 15,285 15,777 14,825 15,577 16,667 17,894 18,995Mexico 10,122 10,656 11,218 12,082 12,790 13,506 14,271

Mercosur 11,394 11,209 10,899 10,924 11,737 12,643 13,794Argentina 11,590 10,817 8,410 8,249 8,503 9,577 11,254Brazil 11,329 11,206 10,800 10,935 11,494 12,154 12,873Paraguay 3,664 4,351 4,321 4,637 4,891 5,115 5,359Uruguay 15,084 16,509 16,562 17,279 18,492 20,116 21,791Venezuela 12,885 12,739 15,871 15,287 18,629 20,997 24,375

Andean Com. 6,637 6,804 6,884 7,243 7,661 8,140 8,652Bolivia 2,423 2,655 2,897 3,124 3,346 3,581 3,851Colombia 7,946 8,017 7,967 8,338 8,739 9,207 9,761Ecuador 5,787 6,077 6,402 6,776 7,191 7,651 8,120Peru 6,540 6,784 6,903 7,300 7,833 8,449 9,062

0 5,000 10,000 15,000 20,000

Bolivia

Paraguay

Ecuador

Andean Com.

Peru

Colombia

Argentina

Latin America

Brazil

Mercosur

Mexico

Chile

Venezuela

Uruguay

6,000

8,000

10,000

12,000

14,000

Latin America Andean Com. Mercosur Argentina Brazil Mexico

2012 2013 2014 2015

-2 0 2 4 6

Venezuela

Argentina

Mercosur

Brazil

Latin America

Mexico

Uruguay

Chile

Ecuador

Colombia

Andean Com.

Paraguay

Bolivia

Peru

0

2

4

6


2012 2013 2014 2015



April 2014

Consumption Growth, 2014

Notes and sources

Note: Total consumption, real annual variation in %. Data for Argentina, Brazil, Mexico, Uruguay and Venezuela refer to private consumption.Sources: National statistical institutes and central banks.

Investment Growth, 2014

Notes and sources

Note: Gross fixed investment, real annual variation in %.Sources: National statistical institutes and central banks.

Consumption, annual variation in %

Investment, annual variation in %

2012 2013 2014 2015 2016 2017 2018Latin America 4.2 3.2 2.5 3.1 3.6 3.8 3.8

Chile 5.6 5.4 4.2 4.3 4.8 4.8 4.9Mexico 4.7 2.5 3.1 4.0 4.2 4.2 4.3

Mercosur 3.9 2.9 1.4 2.2 3.1 3.5 3.7Argentina 4.4 4.5 -0.5 1.1 3.4 4.3 4.5Brazil 3.2 2.3 2.1 2.2 3.1 3.4 3.6Paraguay 3.2 8.7 6.0 4.6 4.6 5.3 5.8Uruguay 5.5 5.3 3.8 3.8 4.2 4.4 4.4Venezuela 7.0 3.9 -0.4 2.6 2.8 3.1 3.3


2012 2013 2014 2015 2016 2017 2018Latin America 2.6 3.2 2.3 4.3 4.9 5.1 5.2

Chile 12.2 0.4 2.5 5.4 6.6 6.7 6.9Mexico 4.6 -1.8 4.5 5.8 5.5 5.7 5.6

Mercosur -0.5 4.8 0.1 2.8 3.8 4.2 4.4Argentina -5.0 4.6 -2.9 1.8 3.7 4.6 4.8Brazil -4.0 6.3 1.7 2.9 4.1 4.6 4.8Paraguay -7.7 14.2 12.1 11.1 7.8 7.5 8.4Uruguay 19.2 6.2 3.5 4.3 4.9 5.2 5.3Venezuela 23.3 -4.6 -6.1 2.2 2.2 2.3 2.7


-10 -5 0 5 10 15

Venezuela

Argentina

Mercosur

Brazil

Latin America

Chile

Uruguay

Mexico

Ecuador

Colombia

Andean Com.

Peru

Bolivia

Paraguay

-6

0

6

12


2012 2013 2014 2015

-2 0 2 4 6 8

Argentina

Venezuela

Mercosur

Brazil

Latin America

Mexico

Uruguay

Ecuador

Chile

Colombia

Andean Com.

Bolivia

Peru

Paraguay

-2

0

2

4

6


2012 2013 2014 2015



April 2014

Industrial Production Growth, 2014

Notes and sources

Note: Industrial production, real annual variation in %.Sources: National statistical institutes.

Retail Sales, 2014

Notes and sources

Note: Retail sales, real annual variation in %.Sources: National statistical institutes.

Industrial Production, annual variation in %

Retail Sales, annual variation in %

2012 2013 2014 2015 2016 2017 2018Latin America -0.2 0.5 1.9 2.8 3.1 3.4 3.5

Chile 2.2 -0.3 2.4 3.8 3.5 3.4 3.3Mexico 2.6 -0.7 3.0 3.9 4.0 4.2 4.4

Mercosur -1.6 1.0 1.1 2.1 2.7 3.1 3.2Argentina -1.2 -0.2 -0.8 2.0 2.7 3.9 4.1Brazil -2.5 1.2 1.6 2.2 2.9 3.2 3.2Paraguay 4.0 9.0 4.1 3.8 4.1 4.3 4.9Uruguay 5.8 4.1 4.4 4.5 4.6 4.7 4.7Venezuela 1.8 0.1 -0.2 1.5 1.8 2.2 2.7

Andean Com. 0.3 0.5 3.8 4.4 4.5 4.8 4.9Bolivia 4.9 6.8 7.2 8.4 9.0 10.0 10.9Colombia -0.2 -1.8 2.7 3.3 3.3 3.5 3.6Ecuador -2.0 4.9 6.2 4.3 4.6 4.8 4.9Peru 1.6 1.7 4.2 5.6 5.8 6.0 6.1

2012 2013 2014 2015 2016 2017 2018Latin America 6.6 3.1 3.5 3.7 4.1 4.5 4.5

Chile 7.1 5.2 4.3 4.5 4.9 4.9 4.7Mexico 3.7 -0.3 2.6 3.4 3.8 4.0 4.2Brazil 8.4 4.3 3.5 3.5 3.9 4.4 4.5Colombia 4.1 4.7 4.9 4.5 5.0 5.2 4.9Peru 6.7 5.8 5.6 5.9 6.3 6.5 6.6

2 3 4 5 6

Mexico

Latin America

Brazil

Chile

Colombia

Peru

-2

0

2

4

6

8

10

Latin America Brazil Chile Colombia Mexico Peru

2012 2013 2014 2015

-2 0 2 4 6 8

Argentina

Venezuela

Mercosur

Brazil

Latin America

Chile

Colombia

Mexico

Andean Com.

Paraguay

Peru

Uruguay

Ecuador

Bolivia

-4

-2

0

2

4

6


2012 2013 2014 2015



April 2014

Unemployment, 2014

Notes and sources

Note: Unemployment rate as % of active population (for details see notes in country).Sources: National statistical institutes.

Fiscal Balance, 2014

Notes and sources

Note: Argentina: Non-financial public sector.Brazil: Public sector borrowing requirement.Chile: Central government.Colombia: Central government.Ecuador: Non-financial public sector.Mexico: Non-financial public sector.Peru: Non-financial public sector.Venezuela: Non-financial central government.Sources: National statistical institutes and finance ministries.

Unemployment, % of active population

Fiscal Balance, % of GDP

2012 2013 2014 2015 2016 2017 2018Latin America 6.5 6.3 6.5 6.6 6.5 6.4 6.4

Chile 6.5 6.0 6.5 6.8 6.6 6.5 6.4Mexico 5.0 4.9 4.7 4.6 4.6 4.5 4.5

Mercosur 6.1 5.9 6.4 6.6 6.5 6.5 6.4Argentina 7.2 7.1 7.8 8.2 7.9 7.6 7.5Brazil 5.5 5.4 5.7 6.1 6.0 6.0 5.8Paraguay 7.9 6.1 6.6 5.9 5.8 5.7 5.6Uruguay 6.3 6.5 6.9 6.8 6.7 6.6 6.5Venezuela 7.8 7.5 8.3 8.0 7.9 7.6 7.5


2012 2013 2014 2015 2016 2017 2018Latin America -2.9 -3.2 -3.5 -3.3 -3.1 -2.9 -2.8

Chile 0.6 -0.6 -0.9 -0.7 -0.5 -0.4 -0.3Mexico -2.6 -2.3 -3.6 -3.1 -2.7 -2.4 -2.5

Mercosur -2.8 -3.3 -3.4 -3.2 -3.1 -2.9 -2.7Argentina -2.5 -2.5 -2.7 -2.6 -2.1 -1.8 -1.8Brazil -2.5 -3.3 -3.8 -3.5 -3.4 -3.3 -3.2Paraguay -1.8 -1.9 -0.9 -0.4 -0.7 -0.4 -0.6Uruguay -2.0 -1.6 -2.4 -2.0 -1.9 -1.8 -1.4Venezuela -4.9 -4.8 -2.5 -2.7 -2.5 -2.2 -1.8

Andean Com. -0.4 -1.3 -1.4 -1.2 -1.0 -0.9 -0.8Bolivia 1.8 0.1 -0.1 0.0 0.1 -0.2 -0.1Colombia -1.9 -2.2 -1.9 -1.8 -1.5 -1.4 -1.3Ecuador -0.9 -2.6 -2.8 -2.5 -2.0 -1.8 -1.7Peru 2.1 0.8 0.1 0.1 0.2 0.2 0.4

-4 -2 0 2

Brazil

Mexico

Latin America

Mercosur

Ecuador

Argentina

Venezuela

Uruguay

Colombia

Andean Com.

Chile

Paraguay

Bolivia

Peru

-4

-3

-2

-1

0


2012 2013 2014 2015

4 6 8 10

Mexico

Ecuador

Brazil

Peru

Mercosur

Chile

Latin America

Paraguay

Uruguay

Bolivia

Andean Com.

Argentina

Venezuela

Colombia

4

6

8

10


2012 2013 2014 2015



April 2014

Inflation, 2014

Notes and sources

Note: End-of-year variation of consumer price index in %.Sources: National statistical institutes and central banks.

Interest Rate, 2014

Notes and sources

Note: Nominal end-of-year interest rates in %. Argentina: Central Bank 30-59 days deposit rate.Bolivia: Prime lending rate.Brazil: SELIC rate.Chile: Monetary policy rate.Colombia: Central Bank intervention rate. Ecuador: 91-120 days deposit rate.Mexico: 1-day target interbank rate.Paraguay: Certificate of deposit 180 days.Peru: Monetary policy rate.Uruguay: 30-day deposit rate.Venezuela: 90-day average deposit rate.Sources: National central banks.

Inflation, variation of consumer prices in %

Interest Rate, %2012 2013 2014 2015 2016 2017 2018

Latin America 7.20 8.33 9.44 9.85 9.29 9.14 8.91Chile 5.00 4.50 3.71 4.19 4.99 5.09 5.10Mexico 4.50 3.50 3.59 4.17 4.88 5.31 5.38



2012 2013 2014 2015 2016 2017 2018Latin America 6.1 8.5 10.7 9.3 9.0 8.6 8.1

Chile 1.5 3.0 3.1 3.1 3.0 2.8 2.7Mexico 3.6 4.0 3.9 3.5 3.4 3.4 3.4



0 10 20 30

Mexico

Chile

Peru

Colombia

Ecuador

Andean Com.

Uruguay

Latin America

Bolivia

Brazil

Paraguay

Mercosur

Venezuela

Argentina

0

10

20

30


2012 2013 2014 2015

0

5

10

15

20

25

30


2012 2013 2014 2015 0 20 40 60

Peru

Colombia

Andean Com.

Chile

Ecuador

Mexico

Paraguay

Bolivia

Brazil

Uruguay

Latin America

Mercosur

Argentina

Venezuela



April 2014

Depreciation versus USD, 2014

Notes and sources

Note: Annual variation of national currencies versus USD in %. Positive number means currency is losing value against USD. Regional aggregates provided only as indicative information.Sources: Central banks and Thomson Reuters.

Current Account Balance, 2014

Notes and sources

Note: Current account balance as % of GDP. Sources: National statistical institutes and central banks.

Exchange Rates vs. USD, annual variation in %

Current Account Balance, % of GDP2012 2013 2014 2015 2016 2017 2018

Latin America -1.8 -2.4 -2.4 -2.2 -2.1 -2.1 -2.0Chile -3.4 -3.4 -3.6 -3.2 -3.4 -3.3 -2.9Mexico -1.2 -1.8 -1.9 -2.0 -2.0 -2.0 -1.9

Mercosur -1.5 -2.4 -2.2 -1.9 -1.8 -1.8 -1.7Argentina 0.0 -0.8 -0.3 -0.3 -0.4 -0.6 -0.7Brazil -2.4 -3.6 -3.4 -3.1 -2.9 -2.8 -2.7Paraguay -0.9 2.1 0.8 0.2 -0.3 -0.3 -0.3Uruguay -5.3 -5.6 -3.8 -3.8 -3.7 -3.6 -3.4Venezuela 2.9 2.9 2.2 2.5 1.7 1.4 1.1

Andean Com. -2.4 -3.3 -3.2 -3.0 -2.8 -2.8 -2.7Bolivia 8.6 4.2 3.8 2.6 2.3 1.8 1.7Colombia -3.2 -3.4 -3.5 -3.3 -3.2 -3.1 -3.0Ecuador -0.4 -1.4 -1.3 -1.2 -0.9 -1.3 -1.8Peru -3.3 -5.0 -4.7 -4.0 -3.7 -3.6 -3.2

2012 2013 2014 2015 2016 2017 2018Latin America 2.6 13.6 9.6 6.9 4.1 3.9 2.1

Chile -7.9 9.8 7.0 0.9 -1.5 0.2 0.4Mexico -7.8 1.3 -0.8 -0.2 0.8 0.5 0.7

Mercosur 9.1 21.4 16.7 12.8 7.5 6.9 3.4Argentina 14.2 32.6 50.8 28.6 18.4 9.3 4.3Brazil 9.9 15.3 5.2 3.7 2.4 1.7 1.8Paraguay -3.1 6.9 -0.5 0.8 2.4 2.8 3.3Uruguay -3.6 10.2 12.1 5.7 0.9 1.3 1.6Venezuela 0.0 46.5 45.3 45.5 22.2 25.6 8.4

Andean Com. -6.3 7.7 2.8 1.0 0.2 0.4 0.1Bolivia 1.4 -1.4 0.7 0.1 -0.5 0.0 4.9Colombia -8.8 9.2 4.0 1.9 1.5 1.2 0.3Ecuador - - - - - - -Peru -5.3 9.5 2.3 0.1 -1.9 -0.6 -1.0

-6 -3 0 3 6

Peru

Uruguay

Chile

Colombia

Brazil

Andean Com.

Latin America

Mercosur

Mexico

Ecuador

Argentina

Paraguay

Venezuela

Bolivia

-20 0 20 40 60

Mexico

Paraguay

Bolivia

Peru

Andean Com.

Colombia

Brazil

Chile

Latin America

Uruguay

Mercosur

Venezuela

Argentina

-4

-3

-2

-1

0

1


2012 2013 2014 2015

-20

0

20

40

60


2012 2013 2014 2015



April 2014

Export Growth, 2014

Notes and sources

Note: Nominal annual variation in % of merchandise exports.Sources: National statistical institutes and central banks.

Import Growth, 2014

Notes and sources

Note: Nominal annual variation in % of merchandise imports. Sources: National statistical institutes and central banks.

Exports, annual variation in %

Imports, annual variation in %

2012 2013 2014 2015 2016 2017 2018Latin America 1.0 0.6 4.4 6.6 7.3 7.8 7.8

Chile -4.3 -1.7 2.3 5.8 9.9 14.4 11.5Mexico 6.1 2.6 6.6 7.8 9.3 9.6 9.7

Mercosur -2.7 -0.6 1.8 5.9 6.4 5.9 6.2Argentina -3.7 2.6 1.6 3.1 3.0 5.3 5.4Brazil -5.3 -0.2 3.3 8.1 8.1 6.4 6.5Paraguay -7.8 16.7 7.8 6.4 3.7 4.6 6.7Uruguay 6.9 4.0 7.8 5.3 8.0 8.4 9.3Venezuela 4.9 -6.7 -3.5 2.1 4.8 4.6 5.5

Andean Com. 5.5 -3.0 7.3 8.1 9.2 8.8 7.2Bolivia 34.4 2.3 14.9 5.0 9.2 8.5 4.2Colombia 5.6 -2.2 6.6 7.2 9.5 9.3 6.4Ecuador 6.5 5.0 6.6 10.9 8.6 7.3 7.6Peru -0.1 -9.5 6.6 8.6 9.1 9.1 8.9

2012 2013 2014 2015 2016 2017 2018Latin America 4.4 2.7 4.4 6.4 7.5 8.1 8.1

Chile 7.2 -1.2 3.0 5.7 10.1 12.4 11.1Mexico 5.7 2.8 8.1 8.1 9.7 9.8 9.9

Mercosur 1.2 4.5 0.1 5.1 5.5 6.7 6.9Argentina -7.8 8.0 -3.2 4.9 1.0 7.7 7.9Brazil -1.4 7.4 1.6 5.1 6.5 6.7 6.7Paraguay -5.8 7.6 11.1 10.5 7.8 5.3 5.8Uruguay 14.7 -5.6 12.1 4.4 4.2 4.0 3.8Venezuela 26.8 -8.8 -6.6 4.0 6.9 6.3 7.7


-10 -5 0 5 10 15

Venezuela

Argentina

Mercosur

Brazil

Chile

Colombia

Latin America

Ecuador

Andean Com.

Bolivia

Peru

Mexico

Paraguay

Uruguay

-10

-5

0

5

10


2012 2013 2014 2015

-5 0 5 10 15 20

Venezuela

Argentina

Mercosur

Chile

Brazil

Latin America

Peru

Ecuador

Mexico

Colombia

Andean Com.

Uruguay

Paraguay

Bolivia

-10

-5

0

5

10


2012 2013 2014 2015



April 2014

International Reserves, 2014

Notes and sources

Note: International reserves as months of imports.Sources: Central banks.

External Debt, 2014

Notes and sources

Note: External debt as % of GDP.Sources: National statistical institutes, central banks and finance ministries.

International Reserves, months of imports

External Debt, % of GDP

2012 2013 2014 2015 2016 2017 2018Latin America 8.9 8.6 8.4 8.1 8.0 7.7 7.4

Chile 6.6 6.6 6.5 6.2 5.9 5.5 5.3Mexico 5.3 5.6 5.5 5.4 5.3 5.1 4.7



2012 2013 2014 2015 2016 2017 2018Latin America 19.6 20.2 20.2 19.9 19.6 19.1 18.6

Chile 44.2 47.2 48.6 47.7 46.3 44.9 43.3Mexico 19.2 20.5 18.8 18.6 19.2 19.1 18.6



10 20 30 40 50

Brazil

Mexico

Ecuador

Mercosur

Latin America

Paraguay

Colombia

Andean Com.

Peru

Venezuela

Bolivia

Argentina

Uruguay

Chile

0

10

20

30

40


2012 2013 2014 2015

0 5 10 15 20

Ecuador

Argentina

Venezuela

Mexico

Paraguay

Chile

Latin America

Colombia

Andean Com.

Mercosur

Uruguay

Peru

Brazil

Bolivia

0

5

10

15

20

25


2012 2013 2014 2015



April 2014

Mexico Chile

Overview | Spread in bps

Peru

Colombia

Argentina

Venezuela Uruguay

Brazil

Major Risk Indicators | EMBI Spreads and Sovereign Ratings

0

500

1,000

1,500

2,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinArgentina

0

250

500

750

1,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinColombia

0

250

500

750

1,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinPeru

0 400 800 1,200

Chile

Colombia

Peru

Uruguay

Mexico

Brazil

EMBI + Latin

Ecuador

Argentina

Venezuela

0

250

500

750

1,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinChile

0

250

500

750

1,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinMexico

0

250

500

750

1,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinBrazil

0

200

400

600

800

1,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinUruguay

0

500

1,000

1,500

2,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinVenezuela

March February Rating Outlook Rating Outlook Ratings OutlookArgentina 799 907 Caa1 Stable CCC+ Negative CC -Bolivia - - Ba3 Stable BB- Stable BB- StableBrazil 228 251 Baa2 Stable BBB- Stable BBB StableChile 149 159 Aa3 Stable AA- Stable A+ StableColombia 165 184 Baa3 Positive BBB Stable BBB StableEcuador 508 609 Caa1 Stable B Positive B StableMexico 156 195 A3 Stable BBB+ Stable BBB+ StableParaguay - - Ba2 Positive BB- Stable BB- PositivePeru 163 181 Baa2 Positive BBB+ Stable BBB+ StableUruguay 192 217 Baa3 Positive BBB- Stable BBB- StableVenezuela 1,165 1,255 B2 Negative B- Negative B Negative

Moody's S & P Fitch RatingsSovereign Spreads (bps)



April 2014

Mexico Chile

Overview | month-on-month var. in %

Peru

Colombia

Argentina Brazil

Major Stock Markets | Performance in %

Last Month Last 3 Months Last 12 Months YTD Last Month Last 3 Months Last 12 Months YTDArgentina 16.4 5.9 68.7 5.9 10.2 18.2 88.5 18.2Brazil 10.7 2.0 -16.0 2.0 7.1 -2.1 -10.5 -2.1Chile 2.5 -2.9 -28.2 -2.9 1.1 1.8 -14.5 1.8Colombia 15.4 4.7 -14.2 4.7 11.3 5.8 -2.2 5.8Mexico 5.5 -5.1 -12.1 -5.1 4.3 -5.3 -8.2 -5.3Peru 1.9 4.2 -26.1 4.2 -7.4 -9.2 -28.0 -9.2Venezuela - - - - -8.9 -7.8 307.0 -7.8Latin America 8.6 -0.2 -16.3 -0.2 - - - -Emerging Markets 2.9 -0.8 -3.9 -0.8 - - - -World 0.2 0.6 14.2 0.6 - - - -

MSCI Price Indices (USD) National Benchmark Stock Indices (local currencies)March 2014

0

50

100

150

200

Jan-10 Jan-11 Jan-12 Jan-13 Jan-14

Latin AmericaArgentina

50

100

150

200


Latin AmericaColombia

40

60

80

100

120


Latin AmericaBrazil

60

80

100

120

140

160


Latin AmericaMexico

0 5 10 15 20

World

Peru

Chile

EmergingMarkets

Mexico

Latin America

Brazil

Colombia

Argentina

60

80

100

120

140

160


Latin AmericaChile

60

80

100

120

140

160


Latin AmericaPeru



April 2014

United States

Japan

Brazil

Colombia

Peru

Euro Area

Argentina

Chile

Mexico

Venezuela

Cross Exchange Rate Forecasts | Year end

U.S. Dollar (USD) 2012 2013 2014 2015United States - - - -Japan 86.7 105.3 109.6 113.1Euro Area 0.76 0.73 0.76 0.78Argentina 4.92 6.52 9.83 12.64Brazil 2.05 2.36 2.48 2.58Chile 479 525 562 567Colombia 1,767 1,930 2,007 2,045Mexico 12.87 13.04 12.94 12.91Peru 2.55 2.80 2.86 2.86Venezuela 4.30 6.30 9.16 13.32

Japanese Yen (JPY,100) 2012 2013 2014 2015United States 1.15 0.95 0.91 0.88Japan - - - -Euro Area 0.87 0.69 0.69 0.69Argentina 5.67 6.19 8.97 11.18Brazil 2.36 2.24 2.27 2.28Chile 552 499 513 501Colombia 2,037 1,833 1,832 1,809Mexico 14.83 12.38 11.80 11.42Peru 2.94 2.65 2.61 2.53Venezuela 4.96 5.98 8.36 11.78

Brazilian Real (BRL) 2012 2013 2014 2015United States 0.49 0.42 0.40 0.39Japan 42.3 44.6 44.1 43.9Euro Area 0.37 0.31 0.31 0.30Argentina 2.40 2.76 3.96 4.90Brazil - - - -Chile 234 222 226 220Colombia 863 817 808 794Mexico 6.28 5.52 5.21 5.01Peru 1.25 1.18 1.15 1.11Venezuela 2.10 2.67 3.69 5.17

Colombian Peso (COP, 1000) 2012 2013 2014 2015United States 0.57 0.52 0.50 0.49Japan 49.1 54.6 54.6 55.3Euro Area 0.43 0.38 0.38 0.38Argentina 2.78 3.38 4.90 6.18Brazil 1.16 1.22 1.24 1.26Chile 271 272 280 277Colombia - - - -Mexico 7.28 6.75 6.44 6.31Peru 1.44 1.45 1.42 1.40Venezuela 2.43 3.26 4.56 6.51

Peruvian Nuevo Sol (PEN) 2012 2013 2014 2015United States 0.39 0.36 0.35 0.35Japan 34.0 37.7 38.3 39.5Euro Area 0.30 0.26 0.27 0.27Argentina 1.93 2.33 3.44 4.42Brazil 0.80 0.85 0.87 0.90Chile 188 188 197 198Colombia 692 691 702 714Mexico 5.04 4.66 4.52 4.51Peru - - - -Venezuela 1.68 2.25 3.20 4.65

Euro (EUR) 2012 2013 2014 2015United States 1.32 1.38 1.31 1.28Japan 114 145 144 145Euro Area - - - -Argentina 6.48 8.98 12.92 16.19Brazil 2.70 3.25 3.27 3.30Chile 631 724 739 726Colombia 2,330 2,659 2,639 2,619Mexico 16.96 17.96 17.01 16.54Peru 3.37 3.85 3.76 3.67Venezuela 5.67 8.68 12.04 17.06

Argentine Peso (ARS) 2012 2013 2014 2015United States 0.20 0.15 0.10 0.08Japan 17.6 16.2 11.1 8.9Euro Area 0.15 0.11 0.08 0.06Argentina - - - -Brazil 0.42 0.36 0.25 0.20Chile 97 81 57 45Colombia 359 296 204 162Mexico 2.62 2.00 1.32 1.02Peru 0.52 0.43 0.29 0.23Venezuela 0.87 0.97 0.93 1.05

Chilean Peso (CLP, 100) 2012 2013 2014 2015United States 0.21 0.19 0.18 0.18Japan 18.12 20.04 19.50 19.94Euro Area 0.16 0.14 0.14 0.14Argentina 1.03 1.24 1.75 2.23Brazil 0.43 0.45 0.44 0.45Chile - - - -Colombia 369 367 357 361Mexico 2.69 2.48 2.30 2.28Peru 0.53 0.53 0.51 0.50Venezuela 0.90 1.20 1.63 2.35

Mexican Peso (MXN) 2012 2013 2014 2015United States 0.08 0.08 0.08 0.08Japan 6.74 8.08 8.47 8.76Euro Area 0.06 0.06 0.06 0.06Argentina 0.38 0.50 0.76 0.98Brazil 0.16 0.18 0.19 0.20Chile 37.2 40.3 43.4 43.9Colombia 137 148 155 158Mexico - - - -Peru 0.20 0.21 0.22 0.22Venezuela 0.33 0.48 0.71 1.03

Venezuelan Bolívar (VEF) 2012 2013 2014 2015United States 0.23 0.16 0.11 0.08Japan 20.17 16.72 11.97 8.49Euro Area 0.18 0.12 0.08 0.06Argentina 1.14 1.03 1.07 0.95Brazil 0.48 0.37 0.27 0.19Chile 111 83 61 43Colombia 411 306 219 154Mexico 2.99 2.07 1.41 0.97Peru 0.59 0.44 0.31 0.21Venezuela - - - -

FOCUSECONOMICS


April 2014

Economic Release Calendar

Date Country Event15 April Argentina March Consumer Prices15 April Brazil Febuary Retail Sales15 April Ecuador February Economic Activity15 April Ecuador February Merchandise Trade15 April Peru February Economic Activity17 April Chile Central Bank Meeting21 April Ecuador Q1 2014 Unemployment22 April Argentina April Consumer Confidence22 April Argentina February Economic Activity22 April Argentina March Merchandise Trade24 April Brazil April Consumer Confidence (**)25 April Brazil March Balance of Payments25 April Colombia Central Bank Meeting25 April Mexico Central Bank Meeting25 April Mexico February Economic Activity (IGAE)28 April Mexico March Merchandise Trade30 April Brazil April Business Confidence (**)1 May Chile April Copper Prices (**)1 May Peru April Consumer Prices2 May Mexico April IMEF Manufacturing PMI2 May Mexico March Remittances2 May Paraguay April Consumer Prices2 May Paraguay April Economic Activity5 May Chile March Economic Activity (IMACEC)5 May Chile April Business Confidence (**)5 May Colombia April Consumer Prices5 May Uruguay April Consumer Prices6 May Mexico April Consumer Confidence7 May Brazil March Industrial Production7 May Chile April Consumer Prices7 May Ecuador April Consumer Prices7 May Venezuela April Consumer Prices (**)7 May Venezuela April Car Sales (**)8 May Colombia April Consumer Confidence (**)8 May Mexico April Consumer Prices8 May Peru Central Bank Meeting9 May Brazil April Consumer Prices9 May Peru March Merchandise Trade10 May Chile April Consumer Confidence (**)11 May Peru April Business Confidence (**)12 May Ecuador March Merchandise Trade12 May Ecuador March Economic Activity12 May Mexico March Industrial Production12 May Uruguay March Industrial Production

(*) Preliminary estimate. (**) Approximate date.

Calendar

FOCUSECONOMICS Argentina


April 2014

Argentina

OUTLOOK | New GDP calculation reveals weaker economy, sparks controversy on warrant paymentOn 27 March, Finance Minister Axel Kicillof announced that the Argentine economy grew 3.0% in 2013 according to preliminary figures. The increase undershot the 5.1% expansion the government forecast in September 2013 as well as the 4.9% growth implied by the monthly economic activity figures that were released in February, which are a close proxy for GDP growth.

The reading is based on a new GDP calculation methodology that shifts the base year of calculation from 1993 to 2004. New figures bring official estimates closer to the independent estimates that local private analysts produce, which had pointed to lower growth than official sources had been reporting. Previous official GDP figures had been viewed with suspicion both within the country and abroad for overestimating economic growth ever since former President Nestor Kirchner changed senior personnel at the National Statistics Institute (INDEC) in 2007. Provision of inaccurate economic data prompted the International Monetary Fund (IMF) to censure Argentina last year. Within this context, the Fund set out a timeline in December 2013 for the country to take remedial measures, which required Argentina to release new GDP and inflation figures by March 2014.

Last year’s 3.0% expansion fell short of the 3.2% GDP growth threshold that would have triggered payments of around USD 3.5 billions to GDP warrant holders. GDP warrants—which linked coupon payments to the economy performing above pre-set targets—were issued as a part of the 2005 and 2010 debt restructuring that followed Argentina’s default in 2002. It is still not clear whether the government will actually forego warrant repayment or whether it

According to preliminary GDP figures, the Argentine economy expanded 3.0% in 2013. The reading—based on a new methodology to calculate GDP that shifts the base year of calculation from 1993 to 2004—sets official GDP figures in line with independent analysts’ estimates. The release sparked controversy among investors as it fell short of the 3.2% growth that would have triggered payment on GDP warrants. Amid stagnating growth and rampant inflation, the government is facing mounting social unrest as a general strike organized by the trade unions brought the country to a virtual standstill on 10 April.

Panelists expect GDP to rise 0.1% in 2014, which is down 0.5 percentage points from last month’s forecast. In 2015, the panel sees GDP growth accelerating to 1.2%.

Consumer prices rose 3.4% over the previous month in February. LatinFocus Consensus Forecast panelists see inflation ending the year at 27.8%, which is up 4.7 percentage points from last month’s forecast. Next year, the panel sees inflation inching up to 27.9%.

Outlook deteriorates

LONG-TERM TRENDS | 3-year averages

Armando CiccarelliHead of Research

Argentina

2010-12 2013-15 2016-18Population (million): 40.6 42.0 43.4GDP (USD bn): 430 384 424GDP per capita (USD): 10,583 9,159 9,778GDP growth (%): 6.6 1.4 3.0Fiscal Balance (% of GDP): -1.3 -2.6 -1.9Public Debt (% of GDP): 44.0 45.3 47.3Inflation (%): 10.1 20.0 25.5Current Account (% of GDP): -0.2 -0.5 -0.6External Debt (% of GDP): 32.2 36.0 35.8

Individual Forecasters 2014 2015Panelist A -1.0 1.0Panelist B -1.8 0.0Panelist C -1.0 1.5Panelist D -1.0 0.0Panelist E -2.1 1.9Panelist F -1.5 -Panelist G -2.1 0.5Panelist H -1.3 -Panelist I -1.0 -Panelist J -1.8 -Panelist K -3.0 0.0Panelist L -1.5 -0.1Panelist M -1.5 0.1SummaryMinimum -3.0 -0.1Maximum -1.0 1.9Median -1.5 0.1Consensus -1.6 0.5

Non-Official GDP

Note: Non-official GDP estimates, based on year-on-year GDP in %. Individual panelist names are confidential.Source: LatinFocus Consensus Forecast.



April 2014

will set another reference trigger due to the change in the base of GDP growth calculation. On 7 April, Kicillof—who, during the 27 March press conference, stated that eventual payment would be based on new GDP data—announced that all details on warrant repayment will be provided in September, when a release of more detailed GDP figures is scheduled. On the eve of the news, the reaction among investors was broadly negative as prices for GDP warrants dropped sizably. That said, government bonds experienced a rally, since, by not paying the GDP warrants, economic authorities now have more reserves at their disposal to service the debt.

During the same press conference, Kicillof announced the result of the monthly indicator of economic activity for January. Economic activity expanded 1.2% over the same month of the previous year, which was lower than the 1.6% growth the market had expected. This reading was also affected by the change of base year, which explains the lower-than-expected performance. On a monthly basis, economic activity contracted a seasonally-adjusted 0.4% over the previous month.

While the new GDP figures reflect private analysts’ estimates more closely, a discrepancy between official and non-official figures still exists. LatinFocus Consensus Forecast panelists expect GDP growth of 0.1% this year, which is down 0.5 percentage points from last month’s forecast. For 2015, participants expect GDP growth to accelerate to 1.2%. Additionally, LatinFocus panelists expect non-official GDP to experience a 1.6% contraction in 2014 and to expand a meager 0.5% in 2015.

Governmental authorities’ decision to provide more realistic GDP data represents a further step away from the unorthodox style of economic policy management that the administration has adopted since Cristina Fernandez de Kirchner won re-election in 2011. That said, many analysts believe that the decision represented what was mainly an opportunistic move to avoid the warrant repayment, thus tarnishing the credibility of Kirchner’s administration.

Meanwhile, the government recently adopted measures to improve its fiscal position and reduce dependence on Central Bank financing. Economic authorities recently announced a 20.0% reduction on heating gas subsidies, which will affect households, but not industrial users. Moreover, the government issued ARS 5.5 billion worth of peso-denominated bonds maturing in 2017, marking the first bond issue since 2008.

However, the road ahead will be tough for the government. Amid rampant inflation and weak economic activity, social unrest is mounting. On 10 April, a nationwide strike organized by the country’s biggest unions brought the country to a virtual standstill. This is the second general strike the Kirchner administration has faced. Workers are protesting in order to convince the government to lower taxes and raise wages as inflation around 30.0% is eroding workers’ purchasing power.

LatinFocus Consensus Forecast panelists see official inflation at 27.8% by the end of 2014, which is up 4.7 percentage points from last month’s estimate. Panelists estimate that official inflation will inch up to 27.9% by the end of 2015. Forecasts for the non-official inflation gauge point to even higher figures. Panelists surveyed by LatinFocus expect non-official consumer prices to increase to 35.5% in 2014, which is up 0.2 percentage points over last month’s forecast. Analysts see non-official inflation slowing to 29.0% in 2015.

Individual Forecasters 2014 2015Panelist A 34.8 23.3Panelist B 26.2 27.2Panelist C 40.0 35.0Panelist D 30.0 25.0Panelist E 38.0 35.0Panelist F 37.1 31.9Panelist G 38.9 25.8Panelist H 32.1 25.1Panelist I 32.0 -Panelist J 36.1 26.1Panelist K 37.8 -Panelist L 33.6 -Panelist M 35.0 -Panelist N 32.5 30.0Panelist O 37.0 27.0Panelist P 45.0 30.0Panelist Q 34.2 27.0Panelist R 35.0 38.0Panelist S 39.5 28.6SummaryMinimum 26.2 23.3Maximum 45.0 38.0Median 35.0 27.2Consensus 35.5 29.0 .

Non-Official Inflation

Note: Non-official inflation estimates, based on annual variation of consumer prices in %. Individual panelists names are confidential.Source: LatinFocus Consensus Forecast.

Gross Domestic Product | variation in %

Note: Annual variation of GDP in %.Source: Argentina National Statistical Institute (INDEC) and LatinFocus Consensus Forecast.

0.0

4.0

8.0

12.0

2003 2005 2007 2009 2011 2013 2015

%



April 2014

OUTLOOK | Consumer sentiment picks up in March but remains dismalConsumer confidence recovered slightly in March but remains at levels previously seen during the financial crisis in 2012. The Universidad Torcuato di Tella (UTDT) consumer confidence index jumped 8.2% over the previous month to 36.2 points. The result marks a pause to the seemingly-unstoppable downward trend in consumer sentiment that has been recorded over the past five months. At the current level, the index remains deeply entrenched in negative territory and very distant from the 50-point threshold that separates optimistic and pessimistic sentiment.

The rise in confidence was broad-based across all categories, with consumers’ intentions to buy durable goods marking the largest increase.

LatinFocus panelists see private consumption contracting 0.5% this year, which is down 0.2 percentage points from last month’s forecast. Next year, panelists expect consumption to expand 1.1%.

EXTERNAL SECTOR | Exports continue to drop amid grain hoardingIn February, exports contracted 6.1% over the same month last year. The contraction was larger than the 4.3% fall recorded in the same month last year and represented the fourth consecutive drop in exports. The reading was underpinned by a 54.0% drop in grain exports, as farmers continued to hoard grains and soybeans to hedge against the weak peso.

A month-on-month comparison paints a more positive picture than the one reported in the annual figures. Exports expanded 2.1% on a seasonally-adjusted basis in February, which represented a slowdown over the 6.8% expansion recorded in January but marked nonetheless a second consecutive increase. That said, grains exports may pick up in the coming months, as the country expects an all-time record soy crop of 54 million tons in 2014.

Imports expanded 2.4% annually in February (February 2013: +9.8% year-on-year). Amid the continued deterioration in exports, the trade surplus narrowed to USD 44 million, which was just a fraction of the USD 521 million recorded in February 2013. Nonetheless, this was slightly higher than the USD 35 billion surplus recorded in January.

LatinFocus Consensus Forecast panelists expect that exports will expand 1.6% in 2014, pushing them to USD 84.4 billion. For 2015, the panel expects exports to grow 3.1%.

Merchandise Trade

Note: 12-month sum of trade balance in USD billion and annual variation of the12-month sum of exports and imports in %.Source: Argentina Central Bank.

-20

0

20

40

60

7

9

11

13

15

Feb-11 Aug-11 Feb-12 Aug-12 Feb-13 Aug-13 Feb-14

%

Trade Balance (USD bn, left scale)Exports (yoy, right scale)Imports (yoy, right scale)

Consumer Confidence

Note: Monthly consumer confidence index. Values above 50 indicate an optimistic assesment in consumer sentiment while values below 50 indicate a pessimistic assesment.Source: Universidad Torcuato di Tella (UTDT).

30

40

50

60

Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14



April 2014

Economic Indicators | 2009 - 2018

Annual Data 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Real SectorPopulation (million) 39.7 40.1 40.6 41.0 41.5 42.0 42.4 42.9 43.4 43.9GDP per capita (USD) 7,753 9,186 10,975 11,590 10,817 8,410 8,249 8,503 9,577 11,254GDP (USD bn) 308 369 445 475 449 353 350 365 415 493Economic Growth (GDP, annual var. in %) 0.9 9.2 8.9 1.9 3.0 0.1 1.2 2.0 3.4 3.6Domestic Demand (annual var. in %) -1.0 11.3 10.7 1.9 4.8 -0.1 2.0 4.0 4.9 5.3Private Consumption (annual var. in %) 0.5 9.0 10.7 4.4 4.5 -0.5 1.1 3.4 4.3 4.5Fixed Investment (annual var. in %) -10.2 21.2 16.6 -5.0 4.6 -2.9 1.8 3.7 4.6 4.8Industrial Production (annual variation in %) 0.1 9.7 6.5 -1.2 -0.2 -0.8 2.0 2.7 3.9 4.1Unemployment (% of active population, aop) 8.7 7.8 7.2 7.2 7.1 7.8 8.2 7.9 7.6 7.5Fiscal Balance (% of GDP) -0.6 0.2 -1.6 -2.5 -2.5 -2.7 -2.6 -2.1 -1.8 -1.8Public Debt (% of GDP) 48.8 45.3 41.8 44.9 41.2 46.1 48.5 48.7 47.5 45.7Monetary and Financial Sector Money (annual variation of M2 in %) 14.6 34.6 29.8 38.4 25.7 26.7 31.7 26.6 24.8 20.3Inflation (CPI, annual variation in %, eop) 7.7 10.9 9.5 10.8 11.0 27.8 27.9 27.5 24.1 22.1Inflation (CPI, annual variation in %, aop) 6.3 10.5 9.8 10.0 10.6 21.4 28.7 27.7 25.8 23.1Inflation (WPI, annual variation in %, eop) 10.3 14.6 12.7 13.1 14.8 - - - - -Central Bank 30-59 Days Dep. Rate (%, eop) 9.4 10.1 13.3 12.4 17.8 28.3 28.4 23.3 20.9 17.4Stock Market (MERVAL variation in %) 115.0 51.8 -30.1 15.9 88.9 - - - - -Exchange Rate (ARS per USD, eop) 3.80 3.97 4.30 4.92 6.52 9.83 12.64 14.97 16.36 17.06Exchange Rate (ARS per USD, aop) 3.73 3.91 4.13 4.55 5.48 8.47 11.09 13.80 15.67 16.71External Sector Current Account Balance (% of GDP) 3.6 -0.2 -0.5 0.0 -0.8 -0.3 -0.3 -0.4 -0.6 -0.7Current Account Balance (USD bn) 11.0 -0.8 -2.3 0.0 -4.3 -1.2 -1.1 -1.5 -2.6 -3.5Trade Balance (USD bn) 16.9 11.4 9.7 12.4 9.0 12.6 11.7 13.6 12.5 11.1Exports (USD bn) 55.7 68.2 84.1 80.9 83.0 84.4 87.0 89.6 94.3 99.4Imports (USD bn) 38.8 56.8 74.3 68.5 74.0 71.6 75.2 76.0 81.8 88.3Exports (annual variation in %) -20.5 22.5 23.3 -3.7 2.6 1.6 3.1 3.0 5.3 5.4Imports (annual variation in %) -32.5 46.4 30.9 -7.8 8.0 -3.2 4.9 1.0 7.7 7.9International Reserves (USD bn) 48.0 52.2 46.4 43.3 30.6 24.9 18.7 21.3 28.7 34.8International Reserves (months of imports) 14.8 11.0 7.5 7.6 5.0 4.2 3.0 3.4 4.2 4.7External Debt (USD bn) 116 129 141 142 138 140 132 135 145 175External Debt (% of GDP) 37.6 35.1 31.7 29.9 30.7 39.7 37.6 37.0 34.9 35.5 Quarterly Data Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15Economic Growth (GDP, annual var. in %) 5.5 2.6 0.2 -0.3 0.2 0.1 0.5 1.2 1.3 1.3Economic Growth (GDP, qoq s.a. var. in %) -0.2 - - - - - - - - -Domestic Demand (annual var. in %) 5.9 2.9 0.5 -1.1 0.4 0.4 1.3 2.0 2.4 2.5Private Consumption (annual var. in %) 8.3 -4.4 0.7 -0.9 -1.8 -0.6 0.0 0.7 1.0 2.2Fixed Investment (annual var. in %) 6.1 -5.6 -5.5 -4.9 -3.0 2.2 -0.1 1.9 2.8 2.1Industrial Production (annual variation in %) 0.7 -3.5 -1.6 -1.7 0.3 0.4 1.2 1.7 2.0 2.6Unemployment (% of active population) 6.8 6.4 7.8 7.7 7.8 7.7 8.1 8.3 8.0 8.0Inflation (CPI, annual variation in %, eop) 11.0 11.0 18.6 21.0 26.7 27.8 29.2 29.2 28.5 27.9Central Bank 30-59 Days Dep. Rate (%, eop) 16.3 17.8 23.3 25.4 26.8 28.3 31.5 31.0 28.5 28.4Exchange Rate (ARS per USD, eop) 5.79 6.52 8.00 8.47 9.23 9.83 10.36 11.02 11.73 12.64Exchange Rate (ARS per USD, aop) 5.58 6.07 7.60 8.24 8.85 9.53 10.10 10.69 11.38 12.18Current Account Balance (% of GDP) -0.2 -0.8 0.1 -0.2 -0.4 -0.4 -0.6 -0.5 0.0 0.1Current Account Balance (USD bn) -1.1 -1.7 0.5 -0.9 -1.7 -1.6 -2.1 -2.0 0.1 0.5Trade Balance (USD bn) 2.2 1.9 1.3 4.5 3.0 2.5 2.1 4.1 2.7 1.9Exports (USD bn) 22.6 19.5 17.4 23.2 22.7 20.3 18.8 23.2 23.3 21.6Imports (USD bn) 20.4 17.7 16.1 18.7 19.7 17.8 16.7 19.0 20.6 19.7 Monthly Data Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14Economic Growth (GDP, annual var. in %) 6.9 5.8 5.0 5.9 3.2 2.2 2.7 - - -Industrial Production (annual variation in %) 3.8 2.8 -0.5 -0.2 -0.5 -4.7 -5.4 -2.6 -0.5 -Cons. Confidence Index (50-point threshold) 44.5 47.5 50.0 48.7 51.9 49.9 46.2 43.7 33.5 36.2Inflation (CPI, mom variation in %) 0.8 0.9 0.8 0.8 0.9 0.9 1.4 3.7 3.4 -Inflation (CPI, annual variation in %, eop) 10.5 10.6 10.6 10.5 10.6 10.5 11.0 - - -Exchange Rate (ARS per USD, eop) 5.39 5.51 5.67 5.79 5.91 6.14 6.52 8.02 7.89 8.00Exports (annual variation in %) 7.7 2.4 0.4 3.0 5.7 2.8 -13.5 -7.7 -6.1 -



April 2014

0%

10%

20%

30%

40%

< -1.5 -1.0 -0.5 0.0 0.5 1.0 1.5 2.0 > 2.0

Real Sector | Gross Domestic Product

1 | Real GDP | 2000-2018 | var. in %

3 | GDP 2014 | evolution of forecasts

2 | Real GDP | Q1 11-Q4 15 | var. in %. Real GDP growth in % *


Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (INDEC, Instituto Nacional de Estadisticas). Forecasts based on LatinFocus Consensus Forecast.1 GDP, annual variation in %. 2 Quarterly GDP (not seasonally adjusted), year-on-year variation in %. 3 GDP, evolution of 2014 forecasts during the last 18 months.4 GDP, evolution of 2015 forecasts during the last 18 months.5 GDP, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval in

%. Higher columns with darker colors represent a larger number of panelists.

Individual Forecasts 2014 2015abeceb.com - -Banco de Galicia 1.5 -BBVA Banco Francés -0.5 1.0BofA Merrill Lynch 0.1 1.0Capital Economics - -Citigroup Global Mkts 1.0 1.5Credit Suisse -0.3 -0.5C&T Asesores - -Deutsche Bank - -EIU -0.6 2.9Elypsis - -Empiria Consultores 1.0 3.0Espert & Asociados - -Estudio Bein & Asoc. - -Fundación Capital - -Goldman Sachs -0.8 -1.2HSBC -1.0 1.5Itaú BBA - -JPMorgan 0.5 1.9LCG 1.0 0.8Nomura 0.2 0.1OJF & Asociados 1.2 1.0Oxford Economics 0.2 1.7Santander -0.8 1.6UBS - -UIA - CEU -0.5 -SummaryMinimum -1.0 -1.2Maximum 1.5 3.0Median 0.2 1.3Consensus 0.1 1.2History30 days ago 0.6 1.760 days ago 0.9 1.990 days ago 1.7 2.3Additional ForecastsIMF (Apr. 2014) 0.5 1.0World Bank (Jan. 2014) 2.8 2.5

*Forecasts for official GDP, as elaborated by INDEC.

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-10

0

10

2000 2005 2010 2015

ArgentinaLatin AmericaWorld

-5

0

5

10

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

ArgentinaLatin AmericaWorld

-2

0

2

4

6

Nov Feb May Aug Nov Feb

MaximumConsensusMinimum

-2

0

2

4

6



5 | GDP 2014 | Panelist Distribution



April 2014

Real Sector | Additional forecasts

9 | Investment | evol. of forecasts

-4

-2

0

2

4

6


2014 2015

8 | Investment | variation in %

-40

-20

0

20

40

2000 2005 2010 2015

Argentina

Latin America

7 | Consumption | evolution of fcst

-1

0

1

2

3

4


2014 2015

6 | Consumption | variation in %

-20

-10

0

10

20

2000 2005 2010 2015

ArgentinaLatin America

Consumption Investmentvariation in % variation in %

Individual Forecasts 2014 2015 2014 2015abeceb.com - - - -Banco de Galicia 1.6 - 2.1 -BBVA Banco Francés - - - -BofA Merrill Lynch 0.8 1.6 -6.0 2.0Capital Economics - - - -Citigroup Global Mkts 2.1 2.1 -3.9 -0.3Credit Suisse -2.6 -1.5 -2.3 -2.0C&T Asesores - - - -Deutsche Bank -3.5 2.0 -3.3 4.0EIU -1.9 1.5 -9.2 2.0Elypsis - - - -Empiria Consultores - - - -Espert & Asociados -0.9 - -4.5 -Estudio Bein & Asoc. -2.6 - - -Fundación Capital -3.0 - -3.5 -Goldman Sachs - - - -HSBC -0.8 1.0 -3.7 0.4Itaú BBA - - - -JPMorgan - - - -LCG 1.7 1.7 1.2 1.3Nomura 0.7 0.6 0.0 -0.5OJF & Asociados 2.2 0.0 -0.8 6.4Oxford Economics -1.5 1.3 -2.6 1.2Santander -0.5 1.5 -4.5 4.8UBS - - - -UIA - CEU - - - -SummaryMinimum -3.5 -1.5 -9.2 -2.0Maximum 2.2 2.1 2.1 6.4Median -0.8 1.5 -3.4 1.3Consensus -0.5 1.1 -2.9 1.8History30 days ago -0.3 1.4 -2.1 1.960 days ago 0.4 1.5 -0.6 1.990 days ago 2.0 2.6 1.3 3.6

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (INDEC, Instituto Nacional de Estadisticas). Forecasts based on LatinFocus Consensus Forecast.6 Private consumption, annual variation in %. 7 Private consumption, evolution of 2014 and 2015 forecasts during the last 18 months.8 Gross fixed investment, annual variation in %.9 Gross fixed investment, evolution of 2014 and 2015 forecasts during the last 18 months.

Consumption and Investment



April 2014

Real Sector | Additional Forecasts

Industry Unemployment Fiscal Balance variation in % % of active pop. % of GDP

Individual Forecasts 2014 2015 2014 2015 2014 2015abeceb.com -1.8 - 7.6 7.5 -1.4 -Banco de Galicia -0.6 - 7.8 - -2.0 -BBVA Banco Francés 1.8 1.7 7.4 7.7 -1.5 -1.2BofA Merrill Lynch - - 8.0 8.8 -2.0 -3.1Capital Economics - - 8.0 9.0 -2.3 -1.5Citigroup Global Mkts - - 7.7 8.1 -3.1 -2.3Credit Suisse - - - - -2.9 -3.3C&T Asesores - - - - -3.5 -3.8Deutsche Bank -3.5 2.1 - - -4.1 -3.8EIU 2.1 6.0 8.0 8.2 -2.4 -2.3Elypsis - - - - - -Empiria Consultores - - 8.1 8.3 -2.7 -2.6Espert & Asociados - - - - -5.1 -Estudio Bein & Asoc. - - 7.8 - -1.4 -Fundación Capital - - 7.8 - -3.1 -Goldman Sachs - - - - -2.8 -3.2HSBC -1.7 0.9 - - -2.0 -0.7Itaú BBA - - 8.0 8.7 -2.0 -2.0JPMorgan - - - - -3.5 -3.5LCG -1.3 1.1 - - -2.3 -2.7Nomura - - - - -3.0 -3.2OJF & Asociados -0.7 -0.7 7.7 8.6 -3.9 -2.3Oxford Economics -2.8 3.3 7.8 8.0 -1.6 -1.2Santander -1.0 1.0 - - -2.7 -3.7UBS 1.5 2.5 7.9 7.8 -2.4 -2.2UIA - CEU -1.5 - 7.5 - - -SummaryMinimum -3.5 -0.7 7.4 7.5 -5.1 -3.8Maximum 2.1 6.0 8.1 9.0 -1.4 -0.7Median -1.1 1.7 7.8 8.2 -2.6 -2.6Consensus -0.8 2.0 7.8 8.2 -2.7 -2.6History30 days ago -0.4 2.0 7.8 8.2 -2.8 -2.660 days ago 0.2 2.0 8.0 8.3 -2.7 -2.890 days ago 1.0 1.8 7.8 8.1 -2.8 -2.5

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (INDEC, Instituto Nacional de Estadisticas) and the Ministry of Economy (MECON, Ministerio de Economia y Produccion). See below for details. Forecasts based on LatinFocus Consensus Forecast.10 Industrial production, annual variation in %. Source: INDEC.11 Industrial production, evolution of 2014 and 2015 forecasts during the last 18 months.12 Unemployment, % of active population. Source: INDEC.13 Balance of non-financial public sector as % of GDP. Source: MECON.

Industry, Unemployment and Fiscal Balance

13 | Fiscal Balance | % of GDP

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-2

0

2

4

2000 2005 2010 2015

Argentina

Latin America

12 | Unemployment | % of active pop.

5

10

15

20

25

2000 2005 2010 2015


11 | Industry | evol. of forecasts

-1

0

1

2

3

4


2014 2015

10 | Industry | variation in %

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-10

0

10

20

2000 2005 2010 2015




April 2014

0%

20%

40%

60%

< 16.0 20.0 24.0 28.0 32.0 36.0 40.0 44.0 > 44.0

Monetary Sector | Inflation

14 | Inflation | 2000 - 2018 | in %

16 | Inflation 2014 | evolution of fcst

15 | Inflation | Q1 11-Q4 15 | in %


Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the National Statistical Institute (INDEC, Instituto Nacional de Estadisticas). Forecasts are based on LatinFocus Consensus Forecast.14 Inflation, annual variation of consumer price index (CPI) in % (eop). 15 Quarterly inflation, annual variation of consumer price index (CPI) in % (eop).16 Inflation, evolution of 2014 forecasts during the last 18 months.17 Inflation, evolution of 2015 forecasts during the last 18 months.18 Inflation, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval

in %. Higher columns with darker colors represent a larger number of panelists.

Individual Forecasts 2014 2015abeceb.com - -Banco de Galicia 28.0 -BBVA Banco Francés 20.0 21.5BofA Merrill Lynch 31.3 36.8Capital Economics - -Citigroup Global Mkts 31.8 35.0Credit Suisse 30.9 25.1C&T Asesores - -Deutsche Bank - -EIU - -Elypsis 20.0 -Empiria Consultores 25.0 26.1Espert & Asociados - -Estudio Bein & Asoc. - -Fundación Capital - -Goldman Sachs 38.4 25.5HSBC - -Itaú BBA - -JPMorgan - -LCG - -Nomura - -OJF & Asociados - -Oxford Economics - -Santander - -UBS 25.0 25.0UIA - CEU - -SummaryMinimum 20.0 21.5Maximum 38.4 36.8Median 28.0 25.5Consensus 27.8 27.9History30 days ago 23.1 22.160 days ago 18.0 17.290 days ago 13.1 13.8Additional ForecastsIMF (Apr. 2014) N/A N/A

18 | Inflation 2014 | Panelist Distribution

Inflation | annual variation of consumer price index in %

5

15

25

35

45



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0

20

40

60

2000 2005 2010 2015


0

8

16

24

32

40



0

10

20

30

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15




April 2014

0%

20%

40%

60%

< 8.50 9.00 9.50 10.00 10.50 11.00 11.50 12.00 > 12.00

Monetary Sector | Exchange Rate

19 | Exchange Rate | ARS per USD

21 | ARS per USD 2014 | evol. of fcst

20 | Exchange Rate | ARS per USD

22 | ARS per USD 2015 | evol. of fcst

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from Thomson Reuters. Forecasts based on LatinFocus Consensus Forecast.19 Exchange rate, ARS per USD (eop).20 Quarterly exchange rate, ARS per USD (eop).21 Exchange rate, evolution of 2014 forecast during the last 18 months.22 Exchange rate, evolution of 2015 forecast during the last 18 months.23 Exchange rate, panelist distribution of 2014 forecasts. Concentration of panelists in forecast

interval in %. Higher columns with darker colors represent a larger number of panelists.

Individual Forecasts 2014 2015abeceb.com 9.54 11.89Banco de Galicia 9.51 -BBVA Banco Francés 10.30 13.88BofA Merrill Lynch 10.00 13.00Capital Economics - -Citigroup Global Mkts 10.00 13.50Credit Suisse 11.00 13.22C&T Asesores 9.46 11.30Deutsche Bank 9.62 12.57EIU 10.84 13.70Elypsis 9.80 -Empiria Consultores 9.70 12.24Espert & Asociados 9.49 -Estudio Bein & Asoc. 9.33 -Fundación Capital - -Goldman Sachs 10.00 12.70HSBC 10.00 12.90Itaú BBA 11.00 14.30JPMorgan - -LCG 9.22 11.87Nomura 9.10 14.50OJF & Asociados 9.71 11.76Oxford Economics 9.01 9.29Santander 9.80 12.25UBS - -UIA - CEU - -SummaryMinimum 9.01 9.29Maximum 11.00 14.50Median 9.71 12.70Consensus 9.83 12.64History30 days ago 9.91 12.6560 days ago 9.84 12.4890 days ago 8.38 10.61

23 | ARS per USD 2014 | Panelist Distribution

Exchange Rate | ARS per USD

4

6

8

10

12



0

5

10

15

20

2000 2005 2010 2015

0

5

10

15

20



0

5

10

15

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15



April 2014

External Sector | Current Account and Trade Balance

6

8

10

12

14

16


2014 2015

27 | Trade Balance | evol. of forecasts

0

40

80

120

2000 2005 2010 2015

Trade BalanceExportsImports

26 | Trade Balance | USD bn

-5

0

5

10

2000 2005 2010 2015


24 | Current Account | % of GDP

-1.0

-0.5

0.0

0.5


2014 2015

25 | Current Account | evol. of fcst

Current Account and Trade BalanceCurrent Account Trade Balance

% of GDP USD bnIndividual Forecasts 2014 2015 2014 2015abeceb.com -0.3 -0.2 9.3 8.8Banco de Galicia -0.5 - 13.8 -BBVA Banco Francés -0.7 -0.5 10.1 10.7BofA Merrill Lynch 0.6 -0.4 12.4 6.5Capital Economics 0.5 0.0 18.9 15.0Citigroup Global Mkts -0.5 -0.4 - -Credit Suisse -0.9 -0.6 - -C&T Asesores -0.5 0.0 - -Deutsche Bank 0.1 0.5 15.6 15.5EIU -0.2 0.2 16.7 18.3Elypsis - - - -Empiria Consultores -0.5 -1.5 13.8 10.2Espert & Asociados -0.4 - 11.4 -Estudio Bein & Asoc. 0.3 - 13.5 -Fundación Capital -0.6 - 11.8 -Goldman Sachs -1.2 -1.3 10.0 10.5HSBC 0.2 -0.2 14.7 13.6Itaú BBA -0.4 0.5 10.0 12.0JPMorgan - - 17.1 16.3LCG 0.0 0.0 13.7 13.9Nomura - - - -OJF & Asociados -0.9 -0.7 9.4 9.0Oxford Economics -0.2 -0.1 11.5 12.7Santander -0.7 -0.2 10.0 6.5UBS -0.8 -0.8 8.1 8.1UIA - CEU - - 13.0 -SummaryMinimum -1.2 -1.5 8.1 6.5Maximum 0.6 0.5 18.9 18.3Median -0.4 -0.2 12.4 11.3Consensus -0.3 -0.3 12.6 11.7History30 days ago -0.4 -0.2 12.7 12.060 days ago -0.5 -0.6 11.0 9.990 days ago -0.8 -0.9 9.0 8.2

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from National Statistical Institute (INDEC, Instituto Nacional de Estadisticas). Forecasts based on LatinFocus Consensus Forecast.24 Current account balance, as % of GDP. 25 Current account balance, evolution of 2014 and 2015 forecasts during the last 18 months.26 Trade balance, exports and imports, in USD. 27 Trade balance, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014

External Sector | Exports and Imports

Exports and ImportsExports ImportsUSD bn USD bn

Individual Forecasts 2014 2015 2014 2015abeceb.com 81.5 82.8 72.2 74.0Banco de Galicia 84.0 - 70.2 -BBVA Banco Francés 85.2 86.7 75.1 76.0BofA Merrill Lynch 83.9 82.1 71.5 75.6Capital Economics 88.0 92.0 69.1 77.0Citigroup Global Mkts - - - -Credit Suisse - - - -C&T Asesores - - - -Deutsche Bank 87.1 90.9 71.5 75.4EIU 82.0 88.8 65.3 70.5Elypsis - - - -Empiria Consultores 84.0 83.7 70.2 73.5Espert & Asociados 84.4 - 73.0 -Estudio Bein & Asoc. 84.7 - 71.3 -Fundación Capital 82.8 - 71.0 -Goldman Sachs 83.2 84.6 73.2 74.1HSBC 82.4 83.0 70.8 73.2Itaú BBA - - - -JPMorgan 84.5 87.1 67.4 70.8LCG 84.6 88.4 70.9 74.4Nomura - - - -OJF & Asociados 83.7 89.4 74.3 80.4Oxford Economics 87.9 93.5 76.4 80.9Santander - - - -UBS 84.9 84.9 76.8 76.8UIA - CEU 84.0 - 71.0 -SummaryMinimum 81.5 82.1 65.3 70.5Maximum 88.0 93.5 76.8 80.9Median 84.0 86.9 71.3 74.9Consensus 84.4 87.0 71.6 75.2History30 days ago 84.3 86.8 71.4 74.760 days ago 84.2 86.0 73.0 76.290 days ago 85.6 87.8 76.3 79.4

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from National Statistical Institute (INDEC, Instituto Nacional de Estadisticas). Forecasts based on LatinFocus Consensus Forecast.28 Exports, annual variation in %. 29 Exports, evolution of 2014 and 2015 forecasts during the last 18 months.30 Imports, annual variation in %. 31 Imports, evolution of 2014 and 2015 forecasts during the last 18 months.

70

75

80

85

90

95


2014 2015

31 | Imports | evol. of forecasts

-100

-50

0

50

100

2000 2005 2010 2015


30 | Imports | variation in %

-40

-20

0

20

40

2000 2005 2010 2015


28 | Exports | variation in %

80

90

100

110


2014 2015

29 | Exports | evolution of fcst



April 2014

External Sector | Additional forecasts

130

140

150

160

170


2014 2015

35 | External Debt | evol. of forecasts

0

50

100

150

200

2000 2005 2010 2015

Argentina

Latin America

34 | External Debt | % of GDP

0

6

12

18

2000 2005 2010 2015


32 | Int. Reserves | months of imports

10

20

30

40

50


2014 2015

33 | Int. Reserves | evolution of fcst

International Reserves and External DebtInt. Reserves External Debt

USD bn USD bnIndividual Forecasts 2014 2015 2014 2015abeceb.com 25.3 24.6 - -Banco de Galicia 27.0 - - -BBVA Banco Francés 24.8 - - -BofA Merrill Lynch 26.7 16.0 - -Capital Economics - - - -Citigroup Global Mkts 26.0 17.5 114 122Credit Suisse 23.1 15.6 147 139C&T Asesores 27.3 24.2 - -Deutsche Bank 24.2 17.7 136 130EIU - - - -Elypsis - - - -Empiria Consultores 25.9 21.9 - -Espert & Asociados 23.1 - - -Estudio Bein & Asoc. 28.7 - - -Fundación Capital 24.5 - - -Goldman Sachs 22.3 15.0 - -HSBC 23.4 16.9 165 -Itaú BBA 23.6 23.0 - -JPMorgan 23.4 16.4 138 135LCG 25.1 19.1 - -Nomura - - - -OJF & Asociados 22.9 15.1 - -Oxford Economics - - - -Santander - - - -UBS - - - -UIA - CEU - - - -SummaryMinimum 22.3 15.0 114 122Maximum 28.7 24.6 165 139Median 24.7 17.5 138 132Consensus 24.9 18.7 140 132History30 days ago 24.2 17.9 141 13360 days ago 24.4 16.5 143 13590 days ago 25.1 17.9 142 143

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from National Statistical Institute (INDEC, Instituto Nacional de Estadisticas). Forecasts based on LatinFocus Consensus Forecast.32 International reserves, months of imports. 33 International reserves, evolution of 2014 and 2015 forecasts during the last 18 months.34 External debt as % of GDP. 35 External debt, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014

Fact Sheet

Argentina in the Region

Population | %-share in Latin America GDP | %-share in Latin America

Argentina8.4%

Brazil39.6%

Mexico20.9%

Venezuela6.7%

Colombia6.5%

Other17.8%

Argentina7.0%

Brazil33.7%

Mexico19.9%

Colombia7.9%

Peru5.2%

Other26.3%

U.S.A.12.4%

Other EU-27

12.5%

Germany5.4%

Other Asia ex-Japan

6.1%China14.5%

Other LatAm12.3%

Brazil26.1%

Other10.6%

U.S.A.5.0%

EU-2714.4%

Other Asia ex-Japan

10.1%

China6.4%

Other LatAm15.5%

Brazil20.8%

Chile6.4%

Other21.4%

Other7.2%

Manufact. Products81.6%

Mineral Fuels11.2%

Other7.6%


Mineral Fuels6.8%

Food53.0%

Trade Structure

Primary markets | share in %

Primary products | share in %

Economic Structure

GDP by Sector | share in % GDP by Expenditure | share in %

Exports

Exports

Imports

Imports

-20

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment

GovernmentConsumption

PrivateConsumption

0

20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data

Economic Infrastructure

Political Data

Long-term Foreign Currency Ratings

Strengths Weaknesses

• Well educated labor force • Unorthodox economic policy• Rich in natural resources • Vulnerability to external shocks• Competitive exchange rate

.

• Limited access to international financial markets

Energy (2010)Primary Energy Production (trillion Btu): 3,429Primary Energy Consumption (trillion Btu): 3,349Electricity Generation (billion kW-h): 119Electricity Consumption (billion kW-h): 111.1Oil Supply (thousand bpd): 791Oil Consumption (thousand bpd): 620CO2 Emmissions (million metric tons): 174.4

Agency Rating OutlookMoody’s: Caa1 StableS&P: CCC+ NegativeFitch Ratings: CC -

Telecommunication (2012) Telephones - main lines (per 100 inhabitants): 24.3Telephones - mobile cellular (per 100 inhabit.): 143Internet Users (per 100 inhabitants): 55.8Broadband Subscriptions (per 100 inhabitants): 10.9

Transportation (2012) Airports: 1,149Railways (km): 39,966Roadways (km): 231,374Waterways (km): 11,000Chief Ports: Buenos Aires, Bahia Blanca

Official name: Argentine RepublicCapital: Buenos Aires (13.0 m)Other cities: Cordoba (1.5 m)

Rosario (1.2 m)Area (km2): 2,780,400Population (million, 2013 est.): 41.5Population density (per km2, 2012 est.): 14.9Population growth rate (%, 2012 est.): 1.0Life expectancy (years, 2012 est.): 77.1Illiteracy rate (%, 2001): 2.8Language: SpanishMeasures: Metric systemTime: GMT-3

President: Cristina Fernandez de KirchnerLast elections: 23 October 2011Next elections: 2015Central Bank President: Juan Carlos Fabrega

FOCUSECONOMICS Brazil


April 2014

Brazil

REAL SECTOR | Industrial output growth softens in FebruaryIn February, industrial production expanded 0.4% over the previous month on a seasonally-adjusted basis. The result marked a notable deceleration compared to the 3.8% increase recorded in January and market expectations of a 0.5% expansion. In annual terms, industrial production expanded 5.1% in February, which marked the strongest reading since April 2013 (January: -2.2% year-on-year).

According to the Brazilian Institute of Geography and Statistics (IBGE), the deceleration was broad-based and particularly significant in production of capital goods, which grew only 0.1% over the previous month in February, well below the hefty 13.3% expansion observed in January. An increase in output was recorded in 19 of the 27 categories that the Brazilian Institute of Geography and Statistics (IBGE) surveyed. The automobile industry tallied the strongest expansion in February. The positive result came in along recent news that car maker Ford opened a new engine production plan in the northeast of the country, which is expected to ramp up productions of new cars.

Annual average growth in industrial production increased from 0.5% in January to 1.2% in February, regaining the ground lost in the previous month.

LatinFocus Consensus Forecast participants see industrial production expanding 1.6% in 2014, which is unchanged from last month’s estimate. In 2015, industrial output is expected to rise 2.2%.

Outlook stable


Enrique JorgeEconomist

Brazil

2010-12 2013-15 2016-18Population (million): 197 201 206GDP (USD bn): 2,289 2,212 2,503GDP per capita (USD): 11,638 10,980 12,174GDP growth (%): 3.7 2.1 3.0Fiscal Balance (% of GDP): -2.5 -3.5 -3.3Public Debt (% of GDP): 37.6 34.9 37.3Inflation (%): 5.7 6.1 5.5Current Account (% of GDP): -2.2 -3.4 -2.8External Debt (% of GDP): 12.6 14.4 14.3

Industrial output expanded 0.4% over the previous month in February (January: +3.8% month-on-month). On 24 March, Standard and Poor’s downgraded Brazil’s rating from BBB to BBB-. The agency argued that there is a certain degree of inconsistency between its monetary and fiscal policy settings. Fiscal consolidation is currently affected by below-potential growth and off-budget activities. This is narrowing the primary surplus. Moreover, the contractive cycle that the Central Bank started in April 2013 is expected to weigh on growth figures, thus reducing the ability of the public sector to proceed with a relatively smooth budget consolidation.

LatinFocus Consensus Forecast panelists expect the economy to grow 1.9% in 2014, which is up 0.1 percentage points from last month’s forecast. For 2015, panelists see growth at 2.1%.

Annual headline inflation increased from 5.7% in February to 6.2% in March. At its 2 April meeting, the Central Bank raised the SELIC rate by 25 basis points to 11.00%. Panelists see inflation ending 2014 at 6.2% and 2015 at 5.8%.

Industrial Production | variation in %

Note: Month-on-month changes of seasonally adjusted industrial production and annual average growth rate in %.Source: Brazil Institute of Geography and Statistics (IBGE) and FocusEconomics calculations.

-4.0

-2.0

0.0

2.0

4.0

-6.0

-3.0

0.0

3.0

6.0

Feb-12 Aug-12 Feb-13 Aug-13 Feb-14

Month-on-month s.a. (left scale)

Annual average (right scale)

%%



April 2014

The Central Bank expects GDP to grow 2.3% in 2014 according to its Inflation Report from April. LatinFocus Consensus Forecast panelists expect the economy to expand 1.8% in 2014, which is unchanged from last month’s estimate. For 2015, the panel sees GDP growth at 2.1%.

OUTLOOK | Consumer confidence virtually unchanged; remains at a near-record low in MarchIn March, the consumer confidence index published by the Getulio Vargas Foundation (FGV, Fundaçao Getulio Vargas) inched up a seasonally-adjusted 0.1% over the previous month, which contrasted the 1.7% decrease registered in February. The index remained virtually unchanged, edging up from the 107.1 points tallied in February—the lowest level since May 2009—to 107.2 points in March. March’s result reflected that households’ assessments of the current economic situation improved over the previous month, while consumers’ expectations for the future of the economy did not change compared to February.

The FGV confidence index spans a range of 1 to 200 points, where 100 points is considered neutral. While consumer confidence is still above the 100-point threshold indicating optimism, a virtually-uninterrupted downward trend has been in place since the index reached its peak in April 2012, which does not bode well for growth in private consumption going forward.

LatinFocus Consensus Forecast participants expect private consumption to expand 2.1% in 2014, which is up 0.1 percentage points from last month’s forecast. For 2015, panelists expect private consumption to increase 2.2%.

OUTLOOK | Businesses confidence falls further into pessimistic territory in MarchBusiness confidence was down in March according to the Getulio Vargas Foundation (FGV, Fundaçao Getulio Vargas). The index decreased a seasonally-adjusted 2.3% over the previous month and now rests at 96.2 points, down from the 98.5 points tallied in February. As a result, the index moved even further below the 100-point threshold, which signals that businesses are more pessimistic than optimistic.

Firms’ more negative assessment of current business conditions was the main driver behind the decline. Their outlook on business in the coming months also decreased.

LatinFocus Consensus Forecast participants see fixed investment expanding 1.7% in 2014, which is up 0.1 percentage points from last month’s forecast. For 2015, panelists expect fixed investment to expand 2.9%.

MONETARY SECTOR | Inflation increases to an 8-month high in March Consumer prices rose 0.92% in March over the previous month. The print was above both the 0.69% increase recorded in February and market expectations of a 0.85% rise. Prices increased in all but one of the nine categories monitored, with prices for food and beverages registering the strongest increase.

Annual headline inflation increased from 5.7% in February to 6.2% in March, which marked the highest inflation rate since July 2013. Inflation is still within the Central Bank’s tolerance margin of plus/minus 2.0 percentage points around its target of 4.5%.

Consumer Confidence Index

Note: Index of consumer sentiment (seasonally adjusted). The 100-point threshold represents the point above which consumers expect economic conditions to improve.Source: Getulio Vargas Foundation.

90

100

110

120

130


Business Confidence Index

Note: Index of business sentiment (seasonally adjusted). The 100-point threshold represents the point above which businesses expect economic conditions to improve.Source: Getulio Vargas Foundation.

90

100

110

120


4.0

5.0

6.0

7.0

8.0

0.0

0.3

0.6

0.9

1.2

Mar-12 Sep-12 Mar-13 Sep-13 Mar-14

Month-on-month (left scale)

Year-on-year (right scale)

%%

Inflation | Consumer Price Index

Note: Annual and monthly var. of IPCA consumer price index in %. Source: Brazilian Institute of Geography and Statistics (IBGE).



April 2014

The Central Bank sees inflation at 5.6% at the end of 2014. For 2015, the Bank sees inflation closing the year at 5.4%. LatinFocus Consensus Forecast participants see inflation closing 2014 at 6.2%, which is up 0.2 percentage points from last month’s forecast. For 2015, the panel sees inflation at 5.8%.

MONETARY SECTOR | Central Bank rises SELIC rate again in AprilAt its 2 April meeting, the Central Bank’s Monetary Policy Committee (COPOM, Comite de Politica Monetaria) decided to raise the benchmark SELIC interest rate by 25 basis points to 11.00% in a unanimous vote. The increase matched market expectations. The decision to push borrowing rates up came amid ongoing concerns over supply-side related inflationary pressures, especially stemming from higher food prices.

The Bank did not provide a detailed accompanying statement as it did in previous releases. However, most analysts interpreted the recent slowdown in the pace of monetary tightening—last month the rate was increased by 25 basis points after six consecutive months of 50 basis points hikes—as a signal that the Bank intends to bring this cycle to an end. Regarding the current stance of the Central Bank, Marcos Casarin, Brazil Economist at Oxford Economics said that:

The obvious implication for monetary policy would be further interest rate hikes by the central bank (BCB). But as the BCB’s communication has been limited recently and COPOM members have adopted a more data-dependent approach since the February meeting, we will await further data to decide whether an additional 25bp rate hike in May is likely or not. At the moment, we expect one more hike in April and then the SELIC staying at 11% through to the end of the year despite the negative inflation surprise in March. In particular, we believe the BCB will take advantage of a stronger BRL to counter inflationary pressures in a longer forecast horizon.

LatinFocus Consensus Forecast participants see the SELIC rate ending 2014 at an average of 11.19%. Panelists see the SELIC rate ending 2015 at an average of 12.01%.

EXTERNAL SECTOR | Current account registers another shortfall in February In February, the current account balance incurred a deficit of USD 7.4 billion. The print was slightly larger than the USD 6.6 billion shortfall registered in the same month last year and market expectations of a EUR 8.0 billion deficit.

The trade balance registered a deficit of USD 2.1 billion in February, which was slightly greater than the USD 1.3 billion deficit registered in February 2013. Moreover, the services and income balance tallied a USD 5.4 billion deficit in February, which represented a slight improvement compared to the USD 5.8 billion shortfall posted in the same month last year.

The moving 12-month current account deficit widened slightly from USD 81.6 billion in January to USD 82.5 billion in February, representing approximately 3.7% of GDP.

LatinFocus Consensus Forecast participants expect a current account deficit of 3.4% of GDP in 2014, which is unchanged from last month’s forecast. For 2015, panelists expect the current account deficit to be at 3.1% of GDP.

Monetary Policy Rate | in %

Note: SELIC target rate (Taxa SELIC meta) in %.Source: Central Bank of Brazil (Banco Central do Brasil).

6.0

8.0

10.0

12.0

14.0

Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14

%

Current Account Balance | USD billion

Note: Monthly and 12-month current account balance in USD billion.Source: Central Bank of Brazil (BCB) and FocusEconomics calculations.

-90

-80

-70

-60

-50

-40

-15.0

-12.0

-9.0

-6.0

-3.0

0.0


Monthly current account balance (left scale)

12-month current account balance (right scale)



April 2014


Annual Data 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Real Sector Population (million) 193 195 197 198 200 201 203 204 206 207GDP per capita (USD) 8,412 10,997 12,586 11,329 11,206 10,800 10,935 11,494 12,154 12,873GDP (USD bn) 1,626 2,144 2,475 2,247 2,240 2,175 2,219 2,348 2,498 2,663Economic Growth (GDP, annual var. in %) -0.3 7.5 2.7 1.0 2.3 1.8 2.1 2.9 3.1 3.1Domestic Demand (annual var. in %) 0.0 10.9 3.7 0.6 3.6 2.1 2.3 2.6 3.7 3.8Private Consumption (annual var. in %) 4.4 6.9 4.1 3.2 2.3 2.1 2.2 3.1 3.4 3.6Government Consumption (ann. var. in %) 3.1 4.2 1.9 3.3 1.9 - - - - -Fixed Investment (annual var. in %) -6.7 21.3 4.7 -4.0 6.3 1.7 2.9 4.1 4.6 4.8Industrial Production (annual var. in %) -7.4 10.5 0.4 -2.5 1.2 1.6 2.2 2.9 3.2 3.2Retail Sales (annual var. in %) 5.9 10.9 6.6 8.4 4.3 3.5 3.5 3.9 4.4 4.5Unemployment (% of active population, aop) 8.1 6.7 6.0 5.5 5.4 5.7 6.1 6.0 6.0 5.8Fiscal Balance (% of GDP) -3.3 -2.5 -2.6 -2.5 -3.3 -3.8 -3.5 -3.4 -3.3 -3.2Public Debt (% of GDP) 42.5 39.7 37.1 36.0 34.3 35.0 35.5 36.4 37.8 37.7Monetary and Financial Sector Money (annual variation of M2 in %) 8.8 16.7 18.7 9.1 10.9 - - - - -Inflation (CPI, annual var. in %, eop) 4.3 5.9 6.5 5.8 5.9 6.2 5.8 5.5 5.4 5.3Inflation (CPI, annual var. in %, aop) 4.9 5.0 6.6 5.4 6.2 6.1 5.9 5.7 5.5 5.3Inflation (Core, annual var. in %, eop) 4.6 5.6 6.7 5.6 6.1 - - - - -Inflation (PPI, annual var. in %, eop) -4.1 13.9 4.1 9.1 5.1 - - - - -SELIC Rate (%, eop) 8.75 10.75 11.00 7.25 10.00 11.19 12.01 10.46 9.85 9.37Stock Market (Bovespa variation in %) 82.7 1.0 -18.1 7.4 -15.5 - - - - -Exchange Rate (BRL per USD, eop) 1.74 1.66 1.86 2.05 2.36 2.48 2.58 2.64 2.68 2.73Exchange Rate (BRL per USD, aop) 2.00 1.76 1.67 1.95 2.16 2.40 2.54 2.61 2.66 2.71External Sector Current Account Balance (% of GDP) -1.5 -2.2 -2.1 -2.4 -3.6 -3.4 -3.1 -2.9 -2.8 -2.7Current Account Balance (USD bn) -24.3 -47.3 -52.5 -54.2 -81.4 -74.8 -69.6 -68.4 -69.3 -73.2Trade Balance (USD bn) 25.3 20.1 29.8 19.4 2.6 6.9 14.5 18.9 19.4 20.2Exports (USD bn) 153 202 256 243 242 250 271 292 311 331Imports (USD bn) 128 182 226 223 240 243 256 273 291 310Exports (annual var. in %) -22.7 32.0 26.8 -5.3 -0.2 3.3 8.1 8.1 6.4 6.5Imports (annual var. in %) -26.2 42.3 24.5 -1.4 7.4 1.6 5.1 6.5 6.7 6.7International Reserves (USD bn) 239 289 352 373 359 372 376 389 410 425International Reserves (months of imports) 22.4 19.1 18.7 20.1 18.0 18.3 17.6 17.1 16.9 16.5External Debt (USD bn) 198 257 298 313 309 321 326 345 358 365External Debt (% of GDP) 12.2 12.0 12.0 13.9 13.8 14.8 14.7 14.7 14.3 13.7 Quarterly Data Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15Economic Growth (GDP, annual var. in %) 2.2 1.9 2.0 1.6 2.0 1.8 1.8 1.9 2.1 2.2Economic Growth (GDP, qoq s.a. var. in %) -0.5 0.7 0.2 1.3 0.7 0.7 0.1 0.8 0.3 0.6Domestic Demand (annual var. in %) 4.1 3.2 2.4 2.3 2.0 1.8 1.9 1.9 2.3 2.3Private Consumption (annual var. in %) 2.3 1.9 2.1 2.1 1.9 1.8 1.8 1.9 2.1 2.3Fixed Investment (annual var. in %) 7.3 5.5 1.6 1.5 1.8 2.4 3.1 3.0 2.9 2.9Industrial Production (annual var. in %) 0.9 -0.3 1.1 1.4 1.9 2.3 2.6 2.3 2.1 1.7Unemployment (% of active population, aop) 5.4 4.7 5.6 5.9 5.8 5.6 6.2 6.4 6.2 5.5Inflation (CPI, annual var. in %, eop) 5.9 5.9 6.2 6.2 6.4 6.2 6.0 5.9 5.9 5.8SELIC Rate (%, eop) 9.00 10.00 10.75 11.01 11.04 11.19 11.85 11.87 11.88 12.01Exchange Rate (BRL per USD, eop) 2.22 2.36 2.27 2.39 2.45 2.48 2.52 2.55 2.56 2.58Exchange Rate (BRL per USD, aop) 2.29 2.28 2.36 2.35 2.42 2.47 2.50 2.54 2.56 2.57Current Account Balance (% of GDP) -3.0 -3.7 -3.7 -3.2 -3.0 -3.1 -4.0 -3.0 -2.9 -2.9Current Account Balance (USD bn) -17.1 -21.0 -19.3 -17.9 -16.4 -17.6 -20.9 -16.7 -15.9 -17.0Trade Balance (USD bn) 1.5 4.2 -6.1 5.4 4.2 4.4 4.3 3.6 3.9 3.8Exports (USD bn) 63.2 64.5 49.6 62.1 63.2 63.7 60.1 60.8 60.3 59.2Imports (USD bn) 61.8 60.4 55.7 57.2 59.5 59.8 55.8 57.2 56.5 55.4 Monthly Data Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14Economic Activity (IBC-Br, annual var. in %) 2.4 3.4 1.3 3.3 2.7 1.3 0.7 0.9 - -Economic Activity (IBC-Br, mom var. in %) 1.1 -0.2 -0.1 0.2 0.5 -0.4 -1.4 1.3 - -Industrial Production (ann. var. in %) 2.9 1.8 -1.0 2.0 1.0 0.3 -2.6 -2.2 5.1 -Industrial Production (s.a. mom var. in %) 2.0 -2.0 0.2 0.7 0.5 -0.4 -3.8 3.8 0.4 -Retail Sales (annual var. in %) 1.6 6.1 6.3 4.2 5.4 7.1 3.9 6.1 - -Retail Sales (s.a. mom var. in %) 0.3 2.1 0.8 0.5 0.3 0.5 -0.3 0.4 - -Unemployment (% of active population) 6.0 5.6 5.3 5.4 5.2 4.6 4.3 4.8 5.1 -Consumer Confidence Index (100 pt, s.a.) 113.0 109.7 112.9 113.8 111.6 112.5 111.2 108.9 107.1 107.2Business Confidence Index (100 pt, s.a.) 103.8 99.6 99.0 98.0 97.8 99.1 99.9 99.5 98.5 96.2Inflation (CPI, mom variation in %) 0.26 0.03 0.24 0.35 0.57 0.54 0.92 0.55 0.69 0.92Inflation (CPI, annual var. in %) 6.7 6.3 6.1 5.9 5.8 5.8 5.9 5.6 5.7 6.2Exchange Rate (BRL per USD, eop) 2.23 2.28 2.39 2.22 2.24 2.34 2.36 2.41 2.34 2.27Current Account Balance (USD bn) -3.9 -9.0 -5.5 -2.6 -7.1 -5.1 -8.7 -11.6 -7.4 -



April 2014

0%

10%

20%

30%

40%

< 1.0 1.3 1.6 1.9 2.2 2.5 2.8 3.1 > 3.1


1 | Real GDP | 2000-2018 | var. in %


2 | Real GDP | Q1 11-Q4 15 | var. in %. Real GDP growth in %


Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the Brazil Institute of Geography and Statistics (IBGE, Instituto Brasileiro de Geografia e Estatistica). Forecasts based on LatinFocus Consensus Forecast.1 GDP, real annual variation in %. 2 Quarterly GDP (not seasonally adjusted), year-on-year variation in %.3 GDP, evolution of 2014 forecasts during the last 18 months.4 GDP, evolution of 2015 forecasts during the last 18 months.5 GDP, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval in


Individual Forecasts 2014 2015Banco Bradesco 2.1 3.0Banco Fator 1.7 1.8Banco Safra 1.8 1.5Banco Votorantim 1.8 2.0Bank of Tokyo-Mitsubishi UFJ Brasil 2.5 3.0Barclays Capital 1.9 2.4BBVA Research 2.5 1.9BofA Merrill Lynch 1.6 2.0Bradesco - Asset Mgmt 1.3 2.0Capital Economics 2.0 2.5Citigroup Global Mkts 1.3 1.8Datalynk 2.0 -Deutsche Bank 1.7 1.4EIU 1.8 2.1Espírito Santo Investment Bank 2.0 2.0GBM Securities 2.1 2.2Goldman Sachs 1.8 1.8HSBC 1.7 1.2ING 2.0 2.1Itaú BBA 1.4 2.0JPMorgan 1.5 2.2LCA Consultores 2.0 2.5Nomura 1.6 2.5Oxford Economics 1.6 2.3Santander 1.7 1.5Tendências Consultoria Integrada 1.9 2.0UBS 2.3 2.0SummaryMinimum 1.3 1.2Maximum 2.5 3.0Median 1.8 2.0Consensus 1.8 2.1History30 days ago 1.8 2.160 days ago 2.1 2.290 days ago 2.1 2.3Additional ForecastsCentral Bank (Mar. 2014) 2.3 -IMF (Apr. 2014) 1.8 2.7OECD (Nov. 2013) 2.5 2.2

-4

0

4

8

2000 2005 2010 2015

BrazilLatin AmericaWorld

0

2

4

6

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

BrazilLatin AmericaWorld

1

2

3

4

5

6



1

2

3

4

5

6






April 2014



1

3

5

7


2014 2015


-10

0

10

20

30

2000 2005 2010 2015

BrazilLatin America


2

3

4

5


2014 2015


-4

0

4

8

2000 2005 2010 2015

Brazil

Latin America


Individual Forecasts 2014 2015 2014 2015Banco Bradesco 2.7 3.0 6.0 5.0Banco Fator 1.9 2.2 -5.3 2.0Banco Safra 2.1 - 0.0 -Banco Votorantim 2.1 3.0 2.0 4.0Bank of Tokyo-Mitsubishi UFJ Brasil 2.3 3.0 3.0 5.0Barclays Capital 2.0 2.1 0.9 2.5BBVA Research 2.1 1.2 5.2 2.5BofA Merrill Lynch 1.5 1.4 3.4 3.9Bradesco - Asset Mgmt - - - -Capital Economics 2.0 2.5 4.0 4.3Citigroup Global Mkts 1.7 1.9 -0.8 0.9Datalynk 2.0 - 4.5 -Deutsche Bank 1.8 1.3 -0.5 1.4EIU 1.8 2.5 1.0 3.0Espírito Santo Investment Bank - - - -GBM Securities 2.5 2.7 4.5 4.8Goldman Sachs - - - -HSBC 1.8 1.3 1.5 2.6ING 1.9 1.9 2.5 3.0Itaú BBA - - - -JPMorgan 1.6 1.6 0.0 0.9LCA Consultores 2.2 2.9 3.3 2.2Nomura 2.0 2.6 1.9 5.0Oxford Economics 2.1 2.2 1.0 3.9Santander 1.6 1.5 1.5 1.5Tendências Consultoria Integrada 2.4 2.0 2.0 2.8UBS 3.0 2.6 -2.2 0.5SummaryMinimum 1.5 1.2 -5.3 0.5Maximum 3.0 3.0 6.0 5.0Median 2.0 2.2 1.9 2.8Consensus 2.1 2.2 1.7 2.9History30 days ago 2.0 2.1 1.6 2.860 days ago 2.2 2.4 2.2 2.790 days ago 2.3 2.5 2.9 2.9

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the Brazil Institute of Geography and Statistics (IBGE, Instituto Brasileiro de Geografia e Estatistica). Forecasts based on LatinFocus Consensus Forecast.6 Private consumption, annual variation in %. 7 Private consumption, evolution of 2014 and 2015 forecasts during the last 18 months.8 Gross fixed investment, annual variation in %.9 Gross fixed investment, evolution of 2014 and 2015 forecasts during the last 18 months.




April 2014


Industry Unemployment Fiscal Balance variation in % % of active pop. % of GDP

Individual Forecasts 2014 2015 2014 2015 2014 2015Banco Bradesco 2.5 3.0 5.7 6.0 - -Banco Fator - - 6.1 6.6 -3.9 -4.5Banco Safra 1.2 2.1 5.8 6.1 -3.5 -2.7Banco Votorantim 1.8 2.0 5.8 6.0 -4.0 -3.3Bank of Tokyo-Mitsubishi UFJ Brasil - - 5.5 6.0 -4.0 -3.0Barclays Capital 0.1 2.4 6.1 6.3 -3.9 -3.5BBVA Research - - - - - -BofA Merrill Lynch - - 6.5 7.0 -3.2 -2.5Bradesco - Asset Mgmt 1.3 1.9 - - - -Capital Economics - - - - -4.0 -3.8Citigroup Global Mkts - - 5.8 6.0 -3.7 -2.8Datalynk 2.5 - 5.8 - -3.8 -Deutsche Bank 2.0 1.5 5.7 6.1 -4.0 -3.6EIU 2.0 3.3 6.1 6.4 -4.0 -3.7Espírito Santo Investment Bank 2.5 2.5 5.5 5.9 -3.7 -3.4GBM Securities 2.5 2.9 5.6 5.6 -4.1 -4.0Goldman Sachs - - - - -3.7 -3.7HSBC 0.5 0.5 - - - -ING 2.0 2.5 5.5 5.8 -3.5 -3.5Itaú BBA - - 5.4 5.8 -4.4 -4.7JPMorgan 2.5 3.0 6.0 6.5 -3.7 -3.3LCA Consultores 1.7 3.1 5.4 5.2 -3.3 -3.5Nomura - - - - - -Oxford Economics 0.6 2.3 5.5 5.7 -4.4 -3.6Santander 1.3 0.8 5.7 6.6 -3.0 -2.8Tendências Consultoria Integrada - - 5.7 6.0 -3.4 -3.8UBS 0.7 0.9 5.5 5.8 -3.9 -3.2SummaryMinimum 0.1 0.5 5.4 5.2 -4.4 -4.7Maximum 2.5 3.3 6.5 7.0 -3.0 -2.5Median 1.8 2.4 5.7 6.0 -3.8 -3.5Consensus 1.6 2.2 5.7 6.1 -3.8 -3.5History30 days ago 1.6 2.2 5.8 6.1 -3.8 -3.560 days ago 2.1 2.5 5.8 6.1 -3.7 -3.490 days ago 2.5 2.6 5.9 6.1 -3.7 -3.3

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the Brazil Institute of Geography and Statistics (IBGE, Instituto Brasileiro de Geografia e Estatistica) and the Central Bank (BCB, Banco Central do Brasil). See below for details. Forecasts based on LatinFocus Consensus Forecast.10 Industrial production, annual variation in %. Source: IBGE.11 Industrial production, evolution of 2014 and 2015 forecasts during the last 18 months.12 Unemployment, % of active population. Source: IBGE.13 Balance of non-financial public sector as % of GDP. Source: BCB.



-6

-4

-2

0

2000 2005 2010 2015

BrazilLatin America


4

8

12

16

2000 2005 2010 2015

BrazilLatin America


1.5

2.0

2.5

3.0

3.5

4.0


2014 2015


-10

-5

0

5

10

15

2000 2005 2010 2015

BrazilLatin America



April 2014

0%

10%

20%

30%

40%

< 5.4 5.6 5.8 6.0 6.2 6.4 6.6 6.8 > 6.8


14 | Inflation | 2000 - 2018 | in %


15 | Inflation | Q1 11-Q4 15 | in %


Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from Brazil Institute of Geography and Statistics (IBGE, Instituto Brasileiro de Geografia e Estatistica). Forecasts are based on LatinFocus Consensus Forecast.14 Inflation, annual variation of consumer price index (CPI) in % (eop). 15 Quarterly inflation, annual variation of consumer price index (CPI) in % (eop).16 Inflation, evolution of 2014 forecasts during the last 18 months.17 Inflation, evolution of 2015 forecasts during the last 18 months.18 Inflation, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval


Individual Forecasts 2014 2015Banco Bradesco 6.3 5.6Banco Fator 6.2 5.8Banco Safra 6.3 5.7Banco Votorantim 6.3 6.0Bank of Tokyo-Mitsubishi UFJ Brasil 6.3 6.0Barclays Capital 6.0 5.6BBVA Research 6.0 5.4BofA Merrill Lynch 6.0 5.4Bradesco - Asset Mgmt 6.3 6.0Capital Economics - -Citigroup Global Mkts 6.1 5.8Datalynk 6.0 -Deutsche Bank 6.3 5.9EIU 6.0 5.8Espírito Santo Investment Bank 6.4 5.9GBM Securities - -Goldman Sachs 6.1 5.5HSBC 6.3 5.8ING 6.6 6.4Itaú BBA 6.5 6.5JPMorgan 6.5 5.7LCA Consultores 6.2 5.7Nomura 6.0 5.0Oxford Economics 6.4 6.0Santander 6.0 5.5Tendências Consultoria Integrada 6.0 6.3UBS 6.2 6.0SummaryMinimum 6.0 5.0Maximum 6.6 6.5Median 6.2 5.8Consensus 6.2 5.8History30 days ago 6.0 5.760 days ago 5.9 5.690 days ago 5.9 5.6Additional ForecastsCentral Bank (Mar. 2014) 5.6 5.4IMF (Apr. 2014) 5.8 5.4OECD (Nov. 2013) 5.9 5.0



4

5

6

7



3

6

9

12

15

2000 2005 2010 2015

Brazil

Latin America

3

4

5

6

7



4

6

8

10

12

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

BrazilLatin America



April 2014

0%

20%

40%

60%

< 10.25 10.50 10.75 11.00 11.25 11.50 11.75 12.00 > 12.00

Monetary Sector | Interest Rate

19 | Interest Rate | 2000 - 2018 | in %

21 | Int. Rate 2014 | evolution of fcst

20 | Interest Rate | Q1 11-Q4 15 | in %


Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the Central Bank (BCB, Banco Central do Brasil). Forecasts are based on LatinFocus Consensus Forecast.19 Interest rate, SELIC rate in % (eop).20 Quarterly interest rate, SELIC rate in % (eop).21 Interest rate, evolution of 2014 forecasts during the last 18 months.22 Interest rate, evolution of 2015 forecasts during the last 18 months.23 Interest rate, panelist distribution of 2014 forecasts. Concentration of panelists in forecast


Individual Forecasts 2014 2015Banco Bradesco 11.00 11.00Banco Fator 11.50 12.25Banco Safra 11.50 12.50Banco Votorantim 11.25 11.75Bank of Tokyo-Mitsubishi UFJ Brasil 11.00 11.00Barclays Capital 11.00 12.00BBVA Research 11.00 12.25BofA Merrill Lynch 11.00 12.00Bradesco - Asset Mgmt 11.75 13.00Capital Economics - -Citigroup Global Mkts 11.00 12.00Datalynk 11.50 -Deutsche Bank 11.25 11.50EIU - -Espírito Santo Investment Bank - -GBM Securities 11.00 11.75Goldman Sachs 11.00 12.50HSBC 11.25 12.25ING 11.00 12.00Itaú BBA 11.00 12.50JPMorgan 11.25 -LCA Consultores 11.25 11.25Nomura - -Oxford Economics - -Santander 11.50 12.50Tendências Consultoria Integrada 11.25 12.25UBS 11.00 12.00SummaryMinimum 11.00 11.00Maximum 11.75 13.00Median 11.13 12.00Consensus 11.19 12.01History30 days ago 11.08 11.9860 days ago 11.12 11.8890 days ago 10.58 11.43

23 | Interest Rate 2014 | Panelist Distribution

Interest Rate | Policy Rate

6

8

10

12



0

10

20

30

2000 2005 2010 2015

Brazil

Latin America

6

8

10

12

14



6

8

10

12

14

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

BrazilLatin America



April 2014

0%

10%

20%

30%

40%

< 2.30 2.35 2.40 2.45 2.50 2.55 2.60 2.65 > 2.65


24 | Exchange Rate | BRL per USD

26 | BRL per USD 2014 | evol. of fcst

25 | Exchange Rate | BRL per USD

27 | BRL per USD 2015 | evol. of fcst

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from Thomson Reuters. Forecasts based on LatinFocus Consensus Forecast.24 Exchange rate, BRL per USD (eop).25 Quarterly exchange rate, BRL per USD (eop).26 Exchange rate, evolution of 2014 forecast during the last 18 months.27 Exchange rate, evolution of 2015 forecast during the last 18 months.28 Exchange rate, panelist distribution of 2014 forecasts. Concentration of panelists in forecast


Individual Forecasts 2014 2015Banco Bradesco 2.40 2.45Banco Fator 2.56 2.55Banco Safra 2.45 2.65Banco Votorantim 2.50 2.60Bank of Tokyo-Mitsubishi UFJ Brasil 2.50 2.55Barclays Capital 2.45 2.60BBVA Research 2.51 2.60BofA Merrill Lynch 2.50 2.60Bradesco - Asset Mgmt 2.60 2.70Capital Economics - -Citigroup Global Mkts 2.65 2.77Datalynk 2.48 -Deutsche Bank 2.40 2.55EIU 2.42 2.50Espírito Santo Investment Bank 2.45 2.45GBM Securities 2.52 2.62Goldman Sachs 2.45 2.70HSBC 2.50 -ING 2.50 2.58Itaú BBA 2.45 2.55JPMorgan 2.50 2.60LCA Consultores 2.40 2.40Nomura 2.45 2.50Oxford Economics 2.51 2.56Santander 2.55 2.65Tendências Consultoria Integrada 2.45 2.58UBS 2.45 2.55SummaryMinimum 2.40 2.40Maximum 2.65 2.77Median 2.49 2.58Consensus 2.48 2.58History30 days ago 2.51 2.6060 days ago 2.47 2.5690 days ago 2.44 2.52

28 | BRL per USD 2014 | Panelist Distribution

Exchange Rate | BRL per USD

1.5

2.0

2.5

3.0



1

2

3

4

2000 2005 2010 2015

1.5

2.0

2.5

3.0



1.5

1.8

2.1

2.4

2.7

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15



April 2014


5

10

15

20

25


2014 2015


0

100

200

300

400

2000 2005 2010 2015



-6

-4

-2

0

2

2000 2005 2010 2015

BrazilLatin America


-3.6

-3.3

-3.0

-2.7

-2.4


2014 2015



% of GDP USD bnIndividual Forecasts 2014 2015 2014 2015Banco Bradesco -3.5 -3.5 4.8 15.5Banco Fator -3.3 -2.3 7.4 24.6Banco Safra -3.5 -3.1 8.0 17.0Banco Votorantim -4.0 -3.5 -1.4 3.5Bank of Tokyo-Mitsubishi UFJ Brasil -3.3 -3.6 3.0 8.2Barclays Capital -3.3 -2.5 14.7 27.2BBVA Research - - - -BofA Merrill Lynch -3.5 -3.1 3.9 12.3Bradesco - Asset Mgmt - - - -Capital Economics -3.5 -3.0 - -Citigroup Global Mkts -4.0 -4.1 - -Datalynk -3.4 - 2.7 -Deutsche Bank -3.6 -3.6 3.0 12.0EIU -3.6 -3.7 10.0 8.9Espírito Santo Investment Bank -3.6 -3.3 6.0 10.0GBM Securities -3.3 -3.3 - -Goldman Sachs -3.7 -3.7 5.5 11.0HSBC -3.2 -3.0 3.4 -ING -3.7 -3.4 3.0 6.0Itaú BBA -3.7 -2.8 6.9 16.0JPMorgan -3.3 -2.9 3.0 9.8LCA Consultores -3.0 -2.4 12.8 -Nomura -2.7 -2.5 7.0 11.0Oxford Economics -3.4 -3.2 13.7 16.4Santander -2.9 -2.3 14.0 27.1Tendências Consultoria Integrada -4.1 -3.7 5.3 13.8UBS -3.0 -2.7 15.9 24.4SummaryMinimum -4.1 -4.1 -1.4 3.5Maximum -2.7 -2.3 15.9 27.2Median -3.5 -3.2 5.8 12.3Consensus -3.4 -3.1 6.9 14.5History30 days ago -3.4 -3.1 8.2 15.360 days ago -3.3 -3.0 10.3 15.390 days ago -3.2 -2.9 9.6 15.5

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (BCB, Banco Central do Brasil) and the Ministry of Development, Industry and Foreign Trade (MDIC, Ministerio do Desenvolvimento, Industria e Comercio Exterior). Forecasts based on LatinFocus Consensus Forecast.29 Current account balance, as % of GDP. Source: BCB.30 Current account balance, evolution of 2014 and 2015 forecasts during the last 18 months.31 Trade balance, exports and imports, in USD. Source: MDIC. 32 Trade balance, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014



Individual Forecasts 2014 2015 2014 2015Banco Bradesco 245 284 241 269Banco Fator 247 262 240 237Banco Safra 241 253 233 236Banco Votorantim 248 263 249 259Bank of Tokyo-Mitsubishi UFJ Brasil 253 273 250 265Barclays Capital 247 268 232 241BBVA Research - - - -BofA Merrill Lynch 250 268 246 256Bradesco - Asset Mgmt - - - -Capital Economics - - - -Citigroup Global Mkts - - - -Datalynk 257 - 254 -Deutsche Bank 243 257 240 245EIU 256 286 246 277Espírito Santo Investment Bank 249 278 243 268GBM Securities - - - -Goldman Sachs 251 267 245 256HSBC 241 - 237 -ING 252 267 249 261Itaú BBA 245 252 238 236JPMorgan 253 265 250 255LCA Consultores 243 - 231 -Nomura - - - -Oxford Economics 268 291 255 275Santander 260 286 246 259Tendências Consultoria Integrada 246 265 241 251UBS 261 285 245 260SummaryMinimum 241 252 231 236Maximum 268 291 255 277Median 249 268 245 257Consensus 250 271 243 256History30 days ago 251 268 243 25360 days ago 253 271 243 25690 days ago 253 271 244 256

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Ministry of Development, Industry and Foreign Trade (MDIC, Ministerio do Desenvolvimento, Industria e Comercio Exterior). Forecasts based on LatinFocus Consensus Forecast.33 Exports, annual variation in %. 34 Exports, evolution of 2014 and 2015 forecasts during the last 18 months.35 Imports, annual variation in %. 36 Imports, evolution of 2014 and 2015 forecasts during the last 18 months.

240

260

280

300


2014 2015


-40

-20

0

20

40

60

2000 2005 2010 2015

BrazilLatin America


-40

-20

0

20

40

2000 2005 2010 2015

BrazilLatin America


220

250

280

310

340


2014 2015




April 2014


320

330

340

350

360

370


2014 2015


10

20

30

40

50

2000 2005 2010 2015

Brazil

Latin America


0

5

10

15

20

25

2000 2005 2010 2015

BrazilLatin America


370

390

410

430


2014 2015



USD bn USD bnIndividual Forecasts 2014 2015 2014 2015Banco Bradesco 383 394 - -Banco Fator 380 370 - -Banco Safra 345 344 - -Banco Votorantim - - - -Bank of Tokyo-Mitsubishi UFJ Brasil 376 364 - -Barclays Capital 359 369 304 308BBVA Research - - - -BofA Merrill Lynch 350 340 332 319Bradesco - Asset Mgmt 383 394 - -Capital Economics - - - -Citigroup Global Mkts 376 376 322 328Datalynk 360 - - -Deutsche Bank 376 376 - -EIU 368 387 - -Espírito Santo Investment Bank 370 370 - -GBM Securities 354 349 - -Goldman Sachs 370 375 - -HSBC 375 375 333 337ING 371 376 - -Itaú BBA 381 398 - -JPMorgan 372 371 - -LCA Consultores 378 375 - -Nomura - - - -Oxford Economics 382 406 314 337Santander 376 384 - -Tendências Consultoria Integrada 389 393 - -UBS - - - -SummaryMinimum 345 340 304 308Maximum 389 406 333 337Median 375 375 322 328Consensus 372 376 321 326History30 days ago 372 376 322 32960 days ago 372 376 331 34790 days ago 375 379 329 342

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (BCB, Banco Central do Brasil). Forecasts based on LatinFocus Consensus Forecast.38 International reserves, months of imports. 39 International reserves, evolution of 2014 and 2015 forecasts during the last 18 months.40 External debt as % of GDP. 41 External debt, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014

Fact Sheet

Brazil in the Region


Brazil38.5%

Mexico21.8%

Argentina8.1%

Venezuela6.6%

Colombia6.5%

Other18.5%

Brazil33.6%

Mexico19.9%

Colombia7.9%

Argentina7.0%

Peru5.2%

Other26.4%

U.S.A.14.6%

Other EU-27

15.0%

Germany6.4%

Other Asia ex-Japan

11.1%

China15.3%

Other LatAm9.6%

Argentina7.4%

Other20.6%

U.S.A.11.1%

Other EU-27

14.1%

Netherlands6.2%

Other Asia ex-Japan

9.6%

China17.0%

Other LatAm11.8%

Argentina7.4%

Other22.8%

Other9.3%


Mineral Fuels17.7%

Other5.2%


Ores & Metals17.6%

Mineral Fuels10.6%

Food31.3%

Trade Structure



Economic Structure


Exports

Exports

Imports

Imports

-20

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

0

20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



• Stable financial system

.

• Commitment to economic orthodoxy

• Pronounced socio-economic inequalities

• Large domestic market and diversified production

• Strong foreign direct investment flows bolster capital account

• Inadequate infrastructure creates bottleneck for economic growth• Privatization and deregulation lagging

Energy (2010)Primary Energy Production (trillion Btu): 9,467Primary Energy Consumption (trillion Btu): 11,299Electricity Generation (billion kW-h): 507Electricity Consumption (billion kW-h): 456Oil Supply (thousand bpd): 2,713Oil Consumption (thousand bpd): 2,622CO2 Emmissions (million metric tons): 451

Agency Rating OutlookMoody’s: Baa2 StableS&P: BBB- StableFitch Ratings: BBB Stable


Transportation (2012) Airports: 4,105Railways (km): 28,538Roadways (km): 1,580,964Waterways (km): 50,000Chief Ports: Santos, Belem, Itajai

Official name: Federative Republicof Brazil

Capital: Brasilia (2.6m)Other cities: Sao Paulo (11.3m)

Rio de Janeiro (6.3m)Area (km2): 8,514,877Population (million, 2013 est.): 200Population density (per km2, 2012 est.): 23.5Population growth rate (%, 2012 est.): 0.9Life expectancy (years, 2012 est.): 72.8Illiteracy rate (%, 2004 est.): 11.4Language: PortugueseMeasures: Metric systemTime: GMT-2 to GMT-4

President: Dilma RousseffLast elections: 3 October 2010Next elections: 5 October 2014Central Bank President: Alexandre Antonio Tombini

FOCUSECONOMICS Chile


April 2014

REAL SECTOR | Economy grows at slowest pace in almost four years in Q4, decelerates in 2013In the last quarter of 2013, the economy grew 2.7% over the same period of the previous year, which was just over half of the 5.0% expansion observed in the third quarter. The figure fell slightly short of the 2.8% expansion the market had expected and marked the slowest rise since Q1 2010. In the full year 2013, the economy grew 4.1%, which was down from the 5.4% increase recorded in 2012.

The quarterly reading reflected a slowdown in both domestic and external demand. Private consumption rose 4.9% in Q4 (Q3: +5.4% year-on-year) and recorded the slowest increase since Q4 2009. In addition, government consumption decelerated from a 5.6% rise in Q3 to a 3.1% increase in Q4. Fixed investment plummeted 12.3% and recorded the fastest fall since Q3 2009 (Q3: -1.5% yoy).

On the external side of the economy, exports of goods and services swung from an 11.3% increase in Q3 to a 0.9% fall in Q4. In addition, imports decreased 5.3% (Q3: +0.5% yoy). As a result, the external sector’s net contribution to overall economic growth fell from 3.7 percentage points in the third quarter to 2.0 percentage points in the fourth quarter.

On a quarterly basis, the economy contracted 0.1% in seasonally-adjusted terms, which marked a deterioration over the 1.6% expansion recorded in the third quarter.

A powerful earthquake hit northern Chile on 8 April. The tremor destroyed thousands of homes, cut electricity and caused landslides that blocked roads in some parts of northern Chile. However, the copper industry escaped major damages and the impact of the quake on economic activity should be limited. Meanwhile, with less than a month in office, President Michelle Bachelet presented her tax-reform package to Parliament. The bill includes a rise in the corporate-tax rate from 20% to 25% over the next four years to pay for increased spending on education, one of Bachelet’s major campaign promises.

LatinFocus panelists expect the economy to expand 3.5% in 2014, which is down 0.2 percentage points from last month’s estimate. In 2015, panelists see economic growth at 4.1%.

Annual inflation rose from 3.2% in February to 3.5% in March. Panelists see inflation at 3.1% in 2014, which is up 0.1 percentage points from last month’s estimate. For 2015, the panel expects inflation also at 3.1%.



Dirina MançellariEconomist

2010-12 2013-15 2016-18Population (million): 17.2 17.7 18.1GDP (USD bn): 245 273 324GDP per capita (USD): 14,216 15,393 17,852GDP growth (%): 5.7 3.9 4.5Fiscal Balance (% of GDP): 0.6 -0.8 -0.4Public Debt (% of GDP): 10.5 12.7 14.6Inflation (%): 2.6 2.7 2.9Current Account (% of GDP): -1.0 -3.4 -3.2External Debt (% of GDP): 40.7 47.8 44.8

ChileChile


Note: Year-on-year changes of GDP in %.Source: Chile Central Bank (BCC) and LatinFocus Consensus Forecast.

0.0

2.0

4.0

6.0

8.0

10.0

Q1 2010 Q1 2011 Q1 2012 Q1 2013 Q1 2014

%



April 2014

Consumer Confidence

Note: Consumer confidence index (IPEC, Indice de percepcion de la economia). Values above 50 indicate an optimistic assesment in consumer sentiment while values below 50 indicate a pessimistic assesment.Source: Adimark GfK.

40

45

50

55

60


Business Confidence

Note: Business Confidence Index (IEE, Indice de Expectativas Empresariales).Values above 50 indicate optimistic perception, below 50 indicate negativeperception.Source: Camara de Comercio de Santiago (CCS).

40

50

60

70

80

Jun-09 Dec-09 Jun-10 Dec-10 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13

The Central Bank expects the economy to grow within a range of 3.0% to 4.0% in 2014. LatinFocus Consensus Forecast panelists see the economy growing 3.5% in 2014, which is down 0.2 percentage points from last month’s forecast. For 2015, the panel expects the economy to expand 4.1%.

REAL SECTOR | Economic activity gains momentum in FebruaryIn February, economic activity rose 2.9% over the same month last year according to the monthly indicator for economic activity (IMACEC). February’s print marked the fastest growth rate since September 2013. The figure marked an improvement over the revised 1.6% increase tallied in January (previously reported: 1.4% year-on-year) and overshot the 2.3% rise the markets had expected. According to the Central Bank, the result mainly reflects an improvement in mining.

On a monthly basis, economic activity expanded 0.20%, which was below the 0.49% increase observed in January (previously reported: -0.55% month-on-month). Annual average growth in economic activity inched down from 3.7% in January to 3.6% in February.

A powerful earthquake, which hit the northern city of Iquiqe on 8 April and a forest fire that broke out in the port city of Valparaiso on 13 April, left 17 people dead. However, the impact of these natural disasters on economic activity should be limited.

OUTLOOK | Consumers less confident in MarchIn March, the Adimark GfK consumer confidence index (IPEC, Indice de Percepcion de la Economia) inched down from February’s 54.3 points to 53.4 points. Despite the slight decrease, consumer confidence is still above the 50-point threshold separating optimism from pessimism.

Most of the components of the index deteriorated compared to the previous month. Consumers’ assessment of their personal economic situation as well as their views regarding the country’s economic situation in the next five years deteriorated compared to February. Conversely, consumers’ views on the country’s current economic situation improved compared to the previous month.

LatinFocus Consensus Forecast participants expect total consumption to grow 4.2% in 2014, which is down 0.1 percentage points from last month’s forecast. For 2015, the panel sees total consumption growing 4.3%.

OUTLOOK | Business confidence inches up in Q1In Q1, the business confidence index (IEE, Indice de Expectativas Empresariales) produced by the Santiago Chamber of Commerce (Camara de Comercio de Santiago) inched up from the 57.2 points recorded in Q4 to 58.3 points. Business sentiment is now even higher above the 50-point threshold that separates optimism from pessimism.

The increase was mainly the result of an improvement in firms’ outlook on the industry and services sectors. According to the Chamber of Commerce, businesses’ expectations regarding future sales and expected employment also improved over the previous quarter. Conversely, their sentiment in regard to expected investment deteriorated over the fourth quarter and reached the lowest level in nearly two years.

Economic Activity | variation in %

Note: Year-on-year and annual average growth rate in %.Source: Chile Central Bank (BCC) and FocusEconomics calculations.

0.0

2.0

4.0

6.0

8.0


Year-on-year Annual average

%



April 2014

FocusEconomics Consensus Forecast panelists expect fixed investment to grow 2.5% in 2014, which is down 1.1 percentage points from last month’s estimate. In 2015, the panel expects fixed investment to increase 5.4%.

MONETARY SECTOR | Inflation reaches a 23-month high in March In March, consumer prices rose 0.8% over the previous month. The increase came in above the 0.5% rise tallied in February and slightly overshot the 0.7% increase the market had expected. According to the statistical institute, the monthly increase mainly reflected higher prices for food and non-alcoholic beverages as well as for transportation.

Annual headline inflation increased from 3.2% in February to 3.5% in March, which marked the highest rate since April 2012. However, inflation remains within the Central Bank’s target range of 3.0% plus/minus 1.0 percentage points. The core inflation index, which excludes volatile categories such as oil, fresh fruit and vegetables, increased 0.7% in March (February: +0.4% month-on-month). Annual core inflation increased from 2.7% in February to 2.9% in March.

The Central Bank sees year-end inflation at 3.0% for both 2014 and 2015. LatinFocus Consensus Forecast panelists expect inflation to close 2014 at 3.1%, which is up 0.1 percentage points from last month’s forecast. For 2015, the panel sees inflation also at 3.1%.

EXTERNAL SECTOR | Copper prices fall at sharpest rate in nearly two yearsIn March, copper prices fell 7.0% over the previous month to an average of USD 3.02 per pound (equivalent to USD 6,650 per tonne). March’s decrease followed the 2.0% drop observed in February and confirms the downward trend of copper prices due to slowing demand from China—Chile’s main importer of copper.

A year-on-year comparison corroborates the deterioration suggested by the monthly data. In annual terms, average copper prices fell 13.0% in March, which followed the 11.3% decrease recorded in February. The reading marked the sharpest fall since August 2012.

On 1 April, an 8.2 magnitude earthquake hit the northern coast of Chile. While copper mines did not report major damages, on 2 April, copper prices jumped to a 3-week high—USD 3.05 per pound—amid fear of supply disruption after the government gave a tsunami warning. However, after the government called off the warning, copper prices stabilized and traded a USD 3.03 per pound at the end of the trading day.

The Central Bank expects average copper prices of USD 3.00 per pound in 2014 and USD 2.85 per pound in 2015. FocusEconomics Consensus Forecast panelists expect copper prices to average USD 3.16 per pound in 2014 before moderating to USD 3.04 per pound in 2015.

Copper Price | USD per Lb.

Note: Cash seller and settlement price.Source: London Metal Exchange (LME).

1.0

2.0

3.0

4.0

5.0



Note: Year-on-year and monthly variation of consumer price index in %.Source: Chile National Statistical Institute (INE).

0.0

1.5

3.0

4.5

-0.5

0.0

0.5

1.0




%%



April 2014


Annual Data 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Real Sector Population (million) 16.9 17.1 17.2 17.4 17.6 17.7 17.9 18.0 18.1 18.3GDP per capita (USD) 10,455 12,695 14,668 15,285 15,777 14,825 15,577 16,667 17,894 18,995GDP (USD bn) 177 217 253 266 277 263 278 300 325 347Economic Growth (GDP, annual var. in %) -1.0 5.8 5.8 5.4 4.1 3.5 4.1 4.4 4.5 4.5Total Consumption (annual var. in %) 0.8 9.7 7.8 5.6 5.4 4.2 4.3 4.8 4.8 4.9Private Consumption (annual var. in %) -0.8 10.8 8.9 6.0 5.6 - - - - -Government Consumption (ann. var. in %) 9.2 4.6 2.5 3.7 4.2 - - - - -Fixed Investment (annual var. in %) -12.1 12.2 14.4 12.2 0.4 2.5 5.4 6.6 6.7 6.9Industrial Manufacturing (annual var. in %) -6.7 3.2 8.0 2.2 -0.3 2.4 3.8 3.5 3.4 3.3Supermarket Sales (annual var. in %) 4.7 6.8 3.2 7.1 5.2 4.3 4.5 4.9 4.9 4.7Unemployment (% of active population, aop) 10.5 8.4 7.2 6.5 6.0 6.5 6.8 6.6 6.5 6.4Fiscal Balance (% of GDP) -4.3 -0.3 1.5 0.6 -0.6 -0.9 -0.7 -0.5 -0.4 -0.3Public Debt (% of GDP) 5.8 8.6 11.1 11.9 12.8 12.4 12.7 14.5 14.6 14.6Monetary and Financial Sector Money (annual var. of M2 in %) 3.1 4.1 12.4 16.0 10.7 - - - - -Inflation (CPI, annual var. in %, eop) -1.4 3.0 4.4 1.5 3.0 3.1 3.1 3.0 2.8 2.7Inflation (CPI, annual var. in %, aop) 1.5 1.4 3.3 3.0 1.8 3.3 3.1 3.0 2.9 2.8Inflation (Core, annual var. in %, eop) -2.9 2.5 3.3 1.4 2.3 - - - - -Inflation (WPI, annual var. in %, eop) 7.8 4.7 4.2 2.0 -0.8 - - - - -Monetary Policy Rate (in %, eop) 0.50 3.12 5.25 5.00 4.50 3.71 4.19 4.99 5.09 5.1010-Year Bond Yield (%, eop) 6.34 6.26 5.56 5.51 5.22 5.17 5.22 5.28 5.38 5.56Stock Market (variation of IGPA in %) -6.4 45.2 26.5 -8.1 8.4 - - - - -Exchange Rate (CLP per USD, eop) 507 468 520 479 525 562 567 558 559 562Exchange Rate (CLP per USD, aop) 559 510 484 486 496 558 565 563 559 561External Sector Current Account Balance (% of GDP) 2.0 1.6 -1.2 -3.4 -3.4 -3.6 -3.2 -3.4 -3.3 -2.9Current Account Balance (USD bn) 3.5 3.6 -3.1 -9.1 -9.5 -9.3 -9.0 -10.3 -10.7 -10.1Trade Balance (USD bn) 15.4 15.7 11.0 2.5 2.1 1.8 2.2 1.9 3.9 4.8Exports (USD bn) 55.5 71.1 81.4 78.0 76.7 78.4 83.0 91.2 104.4 116.4Imports (USD bn) 40.1 55.4 70.4 75.5 74.6 76.8 81.2 89.4 100.4 111.6Exports (annual var. in %) -14.0 28.2 14.5 -4.3 -1.7 2.3 5.8 9.9 14.4 11.5Imports (annual var. in %) -31.4 38.1 27.1 7.2 -1.2 3.0 5.7 10.1 12.4 11.1Copper Price (USD per lb, aop) 2.35 3.43 4.00 3.61 3.33 3.16 3.04 3.18 3.21 3.26International Reserves (USD bn) 25.4 27.9 42.0 41.6 41.1 41.4 41.9 44.0 46.3 49.0International Reserves (months of imports) 7.6 6.0 7.2 6.6 6.6 6.5 6.2 5.9 5.5 5.3External Debt (USD bn) 74.0 84.5 98.4 117.6 130.7 127.6 132.6 139.0 145.6 150.5External Debt (% of GDP) 41.8 38.9 38.9 44.2 47.2 48.6 47.7 46.3 44.9 43.3 Quarterly Data Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15Economic Growth (GDP, annual var. in %) 5.0 2.7 3.0 3.7 3.6 3.6 4.3 4.2 4.2 4.3Economic Growth (GDP, qoq s.a. var. in %) 1.6 -0.1 - - - - - - - -Total Consumption (annual var. in %) 5.4 4.6 3.9 3.9 3.9 4.1 3.8 3.9 4.4 5.5Fixed Investment (annual var. in %) -1.5 -12.3 -2.9 -0.1 0.6 4.4 6.3 6.9 7.0 8.3Industrial Manufacturing (annual var. in %) 0.5 -1.6 1.3 2.8 2.4 2.6 3.4 3.4 3.3 3.3Supermarket Sales (annual var. in %) 4.2 5.2 4.8 4.3 4.1 4.0 4.6 4.7 4.8 4.9Unemployment (% of active population, aop) 5.7 5.7 6.5 6.3 6.3 6.3 6.7 6.8 6.8 6.8CCS (IEE) Business Confid. Index 61.6 57.2 58.3 - - - - - - -Inflation (CPI, annual var. in %, eop) 2.0 3.0 3.5 3.5 3.4 3.1 2.9 3.0 3.0 3.1Monetary Policy Rate (in %, eop) 5.00 4.50 4.11 3.94 3.87 3.71 3.79 4.03 4.09 4.1910-Year Bond Yield (%, eop) 5.25 5.22 5.05 5.12 5.12 5.17 4.85 4.85 4.85 5.22Exchange Rate (CLP per USD, eop) 505 525 549 560 563 562 565 562 564 567Exchange Rate (CLP per USD, aop) 507 517 552 556 561 563 563 563 563 566Current Account Balance (% of GDP) -5.2 -3.5 -2.3 -3.1 -4.5 -4.3 -4.2 -4.4 -5.9 -5.1Current Account Balance (USD bn) -3.4 -2.4 -1.5 -2.0 -2.9 -3.0 -2.9 -3.0 -4.0 -3.8Trade Balance (USD bn) -0.5 0.8 2.7 0.9 -0.5 -0.5 0.8 0.7 -0.3 -0.2Exports (USD bn) 18.5 19.4 19.5 19.7 19.2 19.5 19.6 20.5 20.4 21.1Imports (USD bn) 19.0 18.6 16.9 18.8 19.7 19.9 18.8 19.8 20.6 21.3 Monthly Data Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14Economic Activity (IMACEC, annual var. in %) 3.8 5.9 4.7 4.4 2.6 2.8 2.6 1.6 2.9 -Industrial Manufacturing (annual var. in %) -2.5 4.6 -2.1 -1.0 -3.3 -1.3 0.1 -2.0 -2.0 -Unemployment (% of active population) 6.2 5.8 5.7 5.7 5.8 5.7 5.7 6.1 6.1 -Consumer Confid. Index (50-point threshold) 53.0 50.7 50.4 54.6 54.0 55.9 56.6 54.6 54.3 53.4Business Confid. Index (50-point threshold) 53.0 52.2 50.9 54.3 51.5 49.3 50.9 50.4 51.1 51.9Inflation (CPI, mom variation in %) 0.6 0.3 0.2 0.5 0.1 0.4 0.6 0.2 0.5 0.8Inflation (CPI, annual var. in %) 1.9 2.2 2.2 2.0 1.5 2.4 3.0 2.8 3.2 3.5Exchange Rate (CLP per USD, eop) 508 514 511 505 512 533 525 555 559 549Copper Price (USD per lb, aop) 3.18 3.13 3.26 3.25 3.27 3.21 3.28 3.31 3.24 3.02Exports (annual var. in %) -5.4 7.6 11.3 2.5 -4.4 -6.3 -13.9 -17.5 16.5 17.7



April 2014

0%

20%

40%

60%

< 2.2 2.6 3.0 3.4 3.8 4.2 4.6 5.0 > 5.0


1 | Real GDP | 2000-2018 | var. in %


2 | Real GDP | Q1 11-Q4 15 | var. in % Real GDP growth in %


Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (INE, Instituto Nacional de Estadisticas). Forecasts based on LatinFocus Consensus Forecast.1 GDP, real annual variation in %. 2 Quarterly GDP (not seasonally adjusted), year-on-year variation in %.3 GDP, evolution of 2014 forecasts during the last 18 months.4 GDP, evolution of 2015 forecasts during the last 18 months.5 GDP, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval in


Individual Forecasts 2014 2015Banchile Inversiones 3.7 4.6Banco Bradesco 4.3 4.0BBVA Research 3.4 -BCI 3.3 -BICE Inversiones 3.8 4.6BofA Merrill Lynch 3.2 4.0BTG Pactual 3.3 4.0Cámara Com. Santiago 3.5 3.6Capital Economics 2.8 3.0Citigroup Global Mkts 3.5 4.5CorpResearch 3.5 4.0Credicorp Capital 3.6 -Credit Suisse 3.8 4.0Deutsche Bank 3.6 4.1Econsult 3.0 -EIU 4.1 4.4GBM Securities 3.5 3.8Goldman Sachs 3.3 4.5HSBC 3.6 4.5Inversiones Security 3.2 -Itaú BBA 3.3 4.0JPMorgan 3.1 4.2Nomura 4.0 3.8Oxford Economics 3.3 4.7Santander 3.5 4.2UBS 4.0 4.2SummaryMinimum 2.8 3.0Maximum 4.3 4.7Median 3.5 4.1Consensus 3.5 4.1History30 days ago 3.7 4.260 days ago 4.0 4.290 days ago 4.1 4.3Additional ForecastsCentral Bank (March 2013) 3.0-4.0 -IMF (Apr. 2014) 3.6 4.1OECD (Nov. 2013) 4.5 4.9

-5

0

5

10

2000 2005 2010 2015

ChileLatin AmericaWorld

0

4

8

12

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

ChileLatin AmericaWorld

2

3

4

5

6

7



2

3

4

5

6






April 2014



2

4

6

8


2014 2015


-15

0

15

30

2000 2005 2010 2015

ChileLatin America


4.0

4.5

5.0

5.5


2014 2015


0

4

8

12

2000 2005 2010 2015

ChileLatin America


Individual Forecasts 2014 2015 2014 2015Banchile Inversiones 4.1 4.6 3.7 4.6Banco Bradesco - - - -BBVA Research 3.9 - 1.0 -BCI 4.1 - 1.0 -BICE Inversiones 4.8 5.7 0.6 12.1BofA Merrill Lynch 3.6 2.9 - -BTG Pactual 3.9 3.8 -1.4 2.6Cámara Com. Santiago 4.2 4.3 3.0 4.0Capital Economics 4.0 3.8 6.0 5.0Citigroup Global Mkts 4.6 4.6 3.4 6.3CorpResearch 4.5 4.5 0.0 5.0Credicorp Capital 4.5 - - -Credit Suisse 4.0 3.8 4.0 4.0Deutsche Bank 4.5 4.9 4.5 7.0Econsult 4.6 - 2.2 -EIU 4.4 4.3 4.5 5.2GBM Securities 5.0 5.2 5.0 6.8Goldman Sachs - - - -HSBC 3.9 4.1 0.2 3.7Inversiones Security - - -3.2 -Itaú BBA - - - -JPMorgan - - - -Nomura 4.5 4.2 6.0 5.0Oxford Economics 4.0 4.0 3.6 6.4Santander 3.7 3.8 2.6 3.8UBS - - - -SummaryMinimum 3.6 2.9 -3.2 2.6Maximum 5.0 5.7 6.0 12.1Median 4.2 4.3 3.0 5.0Consensus 4.2 4.3 2.5 5.4History30 days ago 4.3 4.5 3.6 6.060 days ago 4.4 4.5 3.9 6.190 days ago 4.5 4.5 4.0 6.1

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (INE, Instituto Nacional de Estadisticas). Forecasts based on LatinFocus Consensus Forecast.6 Total consumption, annual variation in %. 7 Total consumption, evolution of 2014 and 2015 forecasts during the last 18 months.8 Gross fixed investment, annual variation in %.9 Gross fixed investment, evolution of 2014 and 2015 forecasts during the last 18 months.




April 2014


Industry Unemployment Fiscal Balancevariation in % % of active pop. % of GDP

Individual Forecasts 2014 2015 2014 2015 2014 2015Banchile Inversiones - - 6.8 7.2 -1.0 -0.7Banco Bradesco - - - - - -BBVA Research 2.0 - 6.9 - - -BCI 0.2 - - - - -BICE Inversiones 4.0 4.7 6.4 6.5 - -BofA Merrill Lynch - - - - -0.7 -1.0BTG Pactual - - 7.1 7.8 -1.8 -1.8Cámara Com. Santiago 2.0 3.0 6.3 6.5 -0.9 -1.0Capital Economics 2.5 3.0 - - -1.0 -0.5Citigroup Global Mkts - - 6.1 6.4 -0.4 -0.4CorpResearch 2.0 3.0 6.5 7.0 -1.5 -1.0Credicorp Capital - - 6.5 - -0.9 -Credit Suisse - - 6.5 6.8 -0.6 -0.3Deutsche Bank 4.0 4.1 6.3 6.0 -0.8 -0.6Econsult - - 5.9 7.5 - -EIU 2.5 3.5 - - -1.0 -0.5GBM Securities - - 6.1 6.2 - -Goldman Sachs - - - - -0.8 -0.5HSBC 4.0 5.0 6.5 6.5 -1.0 -0.2Inversiones Security 0.8 - 6.4 - -1.0 -Itaú BBA - - 7.0 7.3 -1.3 -0.7JPMorgan - - - - -1.5 -2.0Nomura - - - - -1.0 -1.0Oxford Economics 2.2 4.0 - - -0.7 -0.2Santander - - 6.3 6.5 -0.3 -UBS - - 6.5 7.2 -0.7 -0.2SummaryMinimum 0.2 3.0 5.9 6.0 -1.8 -2.0Maximum 4.0 5.0 7.1 7.8 -0.3 -0.2Median 2.2 3.7 6.5 6.7 -0.9 -0.6Consensus 2.4 3.8 6.5 6.8 -0.9 -0.7History30 days ago 2.5 3.7 6.4 6.7 -0.8 -0.660 days ago 2.5 3.7 6.4 6.7 -0.8 -0.790 days ago 2.4 3.6 6.5 6.8 -0.8 -0.5

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (INE, Instituto Nacional de Estadisticas) and the Ministry of Finance (Ministerio de Hacienda). See below for details. Forecasts based on LatinFocus Consensus Forecast.10 Industrial production, annual variation in %. Source: INE.11 Industrial production, evolution of 2014 and 2015 forecasts during the last 18 months.12 Unemployment, % of active population. Source: INE.13 Balance of non-financial public sector as % of GDP. Source: Ministry of Finance.



-6

0

6

12

2000 2005 2010 2015

Chile

Latin America


4

6

8

10

12

2000 2005 2010 2015

ChileLatin America


2

3

4

5


2014 2015


-10

-5

0

5

10

2000 2005 2010 2015

ChileLatin America



April 2014

0%

20%

40%

60%

80%

< 2.2 2.5 2.8 3.1 3.4 3.7 4.0 4.3 > 4.3


14 | Inflation | 2000 - 2018 | in %


15 | Inflation | Q1 11-Q4 15 | in %


Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the National Statistical Institute (INE, Instituto Nacional de Estadisticas). Forecasts are based on LatinFocus Consensus Forecast.14 Inflation, annual variation of consumer price index (CPI) in % (eop). 15 Quarterly inflation, annual variation of consumer price index (CPI) in % (eop).16 Inflation, evolution of 2014 forecasts during the last 18 months.17 Inflation, evolution of 2015 forecasts during the last 18 months.18 Inflation, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval


Individual Forecasts 2014 2015Banchile Inversiones 2.9 3.0Banco Bradesco - -BBVA Research 3.1 3.0BCI 3.0 -BICE Inversiones 3.1 3.1BofA Merrill Lynch 3.2 3.5BTG Pactual 3.7 3.3Cámara Com. Santiago - -Capital Economics - -Citigroup Global Mkts 3.0 3.0CorpResearch 3.0 3.0Credicorp Capital 3.1 -Credit Suisse 3.5 3.0Deutsche Bank 3.0 3.0Econsult 3.2 3.0EIU 3.1 3.0GBM Securities - -Goldman Sachs 3.3 3.0HSBC 3.0 3.0Inversiones Security 3.0 -Itaú BBA 2.8 3.0JPMorgan 3.5 3.0Nomura 3.0 3.0Oxford Economics 2.9 3.1Santander 3.1 3.0UBS 3.1 3.2SummaryMinimum 2.8 3.0Maximum 3.7 3.5Median 3.1 3.0Consensus 3.1 3.1History30 days ago 3.0 3.060 days ago 2.9 3.090 days ago 2.9 3.0Additional ForecastsCentral Bank (March 2013) 3.0 3.0IMF (Apr. 2014) 3.0 3.0OECD (Nov. 2013) 2.9 3.0



1.5

2.0

2.5

3.0

3.5

4.0



-5

0

5

10

15

2000 2005 2010 2015

ChileLatin America

2.0

2.5

3.0

3.5

4.0



0

3

6

9

12

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

ChileLatin America



April 2014

0%

20%

40%

60%

< 2.00 2.50 3.00 3.50 4.00 4.50 5.00 5.50 > 5.50


19 | Interest Rate | 2000 - 2018 | in %




Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the Central Bank (BCC, Banco Central de Chile). Forecasts are based on LatinFocus Consensus Forecast.19 Interest rate, Central Bank monetary policy rate in % (eop).20 Quarterly interest rate, Central Bank monetary policy rate in % (eop).21 Interest rate, evolution of 2014 forecasts during the last 18 months.22 Interest rate, evolution of 2015 forecasts during the last 18 months.23 Interest rate, panelist distribution of 2014 forecasts. Concentration of panelists in forecast


Individual Forecasts 2014 2015Banchile Inversiones 3.50 4.00Banco Bradesco - -BBVA Research 3.25 -BCI 3.75 -BICE Inversiones 4.00 4.00BofA Merrill Lynch 3.75 4.50BTG Pactual 3.50 4.00Cámara Com. Santiago 4.00 4.00Capital Economics 4.00 4.00Citigroup Global Mkts 4.00 4.00CorpResearch 3.50 3.50Credicorp Capital 3.75 -Credit Suisse 3.50 3.50Deutsche Bank 3.50 -Econsult 3.25 4.00EIU 4.10 4.60GBM Securities 3.75 4.75Goldman Sachs 3.75 5.00HSBC 4.00 5.00Inversiones Security - -Itaú BBA 3.50 4.00JPMorgan 3.50 -Nomura 4.00 4.00Oxford Economics - -Santander 3.50 4.00UBS 4.00 4.50SummaryMinimum 3.25 3.50Maximum 4.10 5.00Median 3.75 4.00Consensus 3.71 4.19History30 days ago 3.84 4.3060 days ago 4.03 4.4990 days ago 4.05 4.40



2

3

4

5

6

7



0

4

8

12

16

2000 2005 2010 2015

ChileLatin America

2

3

4

5

6

7



2

4

6

8

10

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

ChileLatin America



April 2014

0%

10%

20%

30%

40%

< 500 520 540 560 580 600 620 640 > 640


24 | Exchange Rate | CLP per USD

26 | CLP per USD 2014 | evol. of fcst

25 | Exchange Rate | CLP per USD

27 | CLP per USD 2015 | evol. of fcst

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from Thomson Reuters. Forecasts based on LatinFocus Consensus Forecast.24 Exchange rate, CLP per USD (eop).25 Quarterly exchange rate, CLP per USD (eop).26 Exchange rate, evolution of 2014 forecast during the last 18 months.27 Exchange rate, evolution of 2015 forecast during the last 18 months.28 Exchange rate, panelist distribution of 2014 forecasts. Concentration of panelists in forecast


Individual Forecasts 2014 2015Banchile Inversiones 560 550Banco Bradesco 560 553BBVA Research 590 -BCI - -BICE Inversiones 576 563BofA Merrill Lynch 580 600BTG Pactual 585 591Cámara Com. Santiago 567 584Capital Economics 540 550Citigroup Global Mkts 590 590CorpResearch 550 560Credicorp Capital 538 -Credit Suisse 570 550Deutsche Bank 565 -Econsult 530 -EIU 579 596GBM Securities 560 569Goldman Sachs 570 583HSBC 600 600Inversiones Security 530 -Itaú BBA 540 550JPMorgan - -Nomura 540 550Oxford Economics 530 519Santander 570 540UBS 570 575SummaryMinimum 530 519Maximum 600 600Median 566 563Consensus 562 567History30 days ago 560 56260 days ago 541 54590 days ago 534 542

28 | CLP per USD 2014 | Panelist Distribution

Exchange Rate | CLP per USD

400

450

500

550

600

650



400

500

600

700

800

2000 2005 2010 2015

400

450

500

550

600

650



450

475

500

525

550

575

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15



April 2014


0

2

4

6

8


2014 2015


0

35

70

105

140

2000 2005 2010 2015



-4

-2

0

2

4

6

2000 2005 2010 2015

ChileLatin America


-5

-4

-3

-2


2014 2015



% of GDP USD bnIndividual Forecasts 2014 2015 2014 2015Banchile Inversiones -3.3 -3.1 1.7 2.6Banco Bradesco - - - -BBVA Research -3.5 - 1.0 -BCI -3.7 - - -BICE Inversiones -3.3 -4.2 1.5 -1.1BofA Merrill Lynch -3.1 -3.4 2.0 -0.3BTG Pactual -3.4 -3.2 3.1 3.3Cámara Com. Santiago -3.5 -3.3 1.2 1.7Capital Economics -3.5 -3.0 4.5 6.0Citigroup Global Mkts -3.4 -4.0 - -CorpResearch -4.0 -4.0 - -Credicorp Capital -4.0 - 1.8 -Credit Suisse -4.5 -3.7 2.9 3.8Deutsche Bank -3.5 -3.3 -0.1 3.3Econsult -3.5 - - -EIU -4.2 -3.7 3.8 5.3GBM Securities - - 1.4 -0.6Goldman Sachs -3.3 -2.9 1.8 2.9HSBC -3.4 -2.6 2.6 4.0Inversiones Security -3.8 - 0.1 -Itaú BBA -2.7 -1.7 - -JPMorgan -2.8 -3.4 3.3 3.8Nomura -3.5 -3.0 -0.4 -2.3Oxford Economics -4.2 -3.0 0.6 1.0Santander -3.6 -3.5 - -UBS -3.5 -2.8 - -SummaryMinimum -4.5 -4.2 -0.4 -2.3Maximum -2.7 -1.7 4.5 6.0Median -3.5 -3.3 1.8 2.9Consensus -3.6 -3.2 1.8 2.2History30 days ago -3.5 -3.3 2.1 2.660 days ago -3.5 -3.5 1.5 1.390 days ago -3.6 -3.5 1.2 2.1

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (BCC, Banco Central de Chile). Forecasts based on LatinFocus Consensus Forecast.29 Current account balance, as % of GDP. 30 Current account balance, evolution of 2014 and 2015 forecasts during the last 18 months.31 Trade balance, exports and imports, in USD. 32 Trade balance, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014



Individual Forecasts 2014 2015 2014 2015Banchile Inversiones 78.1 82.1 76.4 79.5Banco Bradesco - - - -BBVA Research 75.0 - 74.0 -BCI - - - -BICE Inversiones 85.4 93.3 83.9 94.3BofA Merrill Lynch 73.8 72.7 71.8 73.0BTG Pactual 76.9 80.5 73.8 77.2Cámara Com. Santiago 77.1 83.5 75.9 81.8Capital Economics 86.0 90.0 81.5 84.0Citigroup Global Mkts - - - -CorpResearch - - - -Credicorp Capital 79.8 - 78.0 -Credit Suisse 79.0 82.1 76.1 78.3Deutsche Bank 79.9 86.0 80.0 82.7Econsult - - - -EIU 81.4 88.6 77.6 83.3GBM Securities 77.6 77.9 76.1 78.5Goldman Sachs 75.1 78.6 73.2 75.7HSBC 78.5 81.8 75.9 77.8Inversiones Security 75.0 - 74.9 -Itaú BBA - - - -JPMorgan 79.3 84.9 76.0 81.1Nomura 79.4 81.5 79.8 83.8Oxford Economics 76.5 84.9 75.9 83.9Santander - - - -UBS 76.5 79.6 79.0 83.9SummaryMinimum 73.8 72.7 71.8 73.0Maximum 86.0 93.3 83.9 94.3Median 78.1 82.1 76.1 81.5Consensus 78.4 83.0 76.8 81.2History30 days ago 79.9 84.6 78.1 82.560 days ago 81.6 87.1 80.3 86.390 days ago 81.6 87.9 80.7 86.5

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (BCC, Banco Central de Chile). Forecasts based on LatinFocus Consensus Forecast.33 Exports, annual variation in %. 34 Exports, evolution of 2014 and 2015 forecasts during the last 18 months.35 Imports, annual variation in %. 36 Imports, evolution of 2014 and 2015 forecasts during the last 18 months.

75

80

85

90

95

100


2014 2015


-40

-20

0

20

40

2000 2005 2010 2015

ChileLatin America


-30

0

30

60

2000 2005 2010 2015

ChileLatin America


75

85

95

105


2014 2015




April 2014


110

120

130

140


2014 2015


0

20

40

60

80

2000 2005 2010 2015

Chile

Latin America


0

5

10

15

2000 2005 2010 2015

ChileLatin America


41

43

45

47


2014 2015



USD bn USD bnIndividual Forecasts 2014 2015 2014 2015Banchile Inversiones 41.9 42.7 - -Banco Bradesco - - - -BBVA Research 42.0 - 120 -BCI - - - -BICE Inversiones - - - -BofA Merrill Lynch 41.9 41.9 - -BTG Pactual - - - -Cámara Com. Santiago 41.2 43.0 127 136Capital Economics 43.0 44.0 - -Citigroup Global Mkts 37.9 39.7 111 116CorpResearch 39.0 39.0 - -Credicorp Capital 42.8 - - -Credit Suisse 41.9 42.8 136 136Deutsche Bank 43.5 42.0 131 131Econsult - - - -EIU 40.2 41.4 139 147GBM Securities 40.5 40.0 - -Goldman Sachs 39.1 38.1 134 136HSBC 40.0 40.0 124 126Inversiones Security 41.0 - 127 -Itaú BBA 45.0 46.0 - -JPMorgan 39.7 39.7 - -Nomura - - - -Oxford Economics 44.8 48.2 - -Santander 40.5 - - -UBS - - - -SummaryMinimum 37.9 38.1 111 116Maximum 45.0 48.2 139 147Median 41.2 41.9 127 136Consensus 41.4 41.9 128 133History30 days ago 41.5 42.1 126 12960 days ago 42.2 43.6 125 12990 days ago 42.2 43.5 126 132

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (BCC, Banco Central de Chile). Forecasts based on LatinFocus Consensus Forecast.38 International reserves, months of imports. 39 International reserves, evolution of 2014 and 2015 forecasts during the last 18 months.40 External debt as % of GDP. 41 External debt, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014

Chile in the Region


Fact Sheet

Chile4.7%

Brazil39.6%

Mexico20.9%

Argentina8.4%

Venezuela6.7%

Other19.7%

Chile3.1%

Brazil33.7%

Mexico19.9%

Colombia7.9%

Argentina7.0%

Other28.5%

U.S.A.22.9%

EU-2713.4%

Other Asia ex-Japan

6.9%China18.2%

Other LatAm14.7%

Argentina6.6%

Brazil6.5%

Other10.7%

U.S.A.12.3%

Japan10.7%

EU-2715.3%

Other Asia ex-Japan

6.9%China23.3%

Korea5.8%

Other LatAm11.9%

Brazil5.5%

Other8.4%

Other2.7%


Mineral Fuels22.8%

Food7.3%

Other0.9%


Ores & Metals62.4%

Agric. Raw Mat.

5.2%

Food17.9%

Trade Structure



Economic Structure


Exports

Exports

Imports

Imports

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20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

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20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



• Market oriented policy firmly • High dependence on copperanchored exports• Structurally sound and prudent • Relatively small domesticfiscal policy market• Free trade agreements with • Privatization of state-ownedmajor economic areas copper giant CODELCO not• Low import tariffs have created on agendacompetitive industry .

Energy (2010) Primary Energy Production (trillion Btu): 344Primary Energy Consumption (trillion Btu): 1,333Electricity Generation (billion kW-h): 57.9Electricity Consumption (billion kW-h): 53.9Oil Supply (thousand bpd): 18.4Oil Consumption (thousand bpd): 323CO2 Emmissions (million metric tons): 79.2

Agency Rating OutlookMoody’s: Aa3 StableS&P: AA- StableFitch Ratings: A+ Stable


Transportation (2012) Airports: 476Railways (km): 7,082Roadways (km): 77,764Chief Ports: Valparaiso, Arica

Official name: Republic of ChileCapital: Santiago (5.8 m)Other cities: Valparaiso (0.9 m)

Concepcion (0.9 m)Area (km2): 756,950Population (million, 2013 est.): 17.6Population density (per km2, 2012 est.): 23.3Population growth rate (%, 2012 est.): 0.9Life expectancy (years, 2012 est.): 78.1Illiteracy rate (%, 2002): 4.3Language: SpanishMeasures: Metric systemTime: GMT-4

President: Michelle BacheletLast elections: 17 November 2013Next elections: 19 November 2017Central Bank President: Rodrigo Vergara Montes

FOCUSECONOMICS Colombia


April 2014

REAL SECTOR | Industrial production accelerates to highest pace in 10 months In February, industrial production (excluding coffee threshing) rose 2.8% over the same month last year, contrasting the 0.1% contraction recorded in January. The increase overshot the 1.2% expansion that market analysts had expected and marked the highest growth rate since April 2013. The monthly figure reflects increases in more than half of the index’s sub-categories, with production of sugar and other food products recording the largest expansion.

Annual average variation in industrial production rose from minus 1.7% in January to minus 1.1% in February, the highest reading since January 2013.

LatinFocus Consensus Forecast participants expect that industrial production will expand 2.7% in 2014, which is down 0.1 percentage points from last month’s forecast. For 2015, the panel expects industrial production to increase 3.3%.

The Central Bank expects the economy to expand between 3.3% and 5.3% in 2014, with 4.3% the most likely figure. LatinFocus Consensus Forecast panelists expect GDP to grow 4.5% in 2014, which is unchanged from the previous month’s projection. For 2015, the panel sees economic growth to inch up to 4.6%.

MONETARY SECTOR | Inflation increases to 16-month high in March In March, consumer prices rose 0.39% over the previous month, following the 0.63% increase registered in February. March’s print came in slightly above

Recent polls suggest that incumbent President Juan Manuel Santos is no longer the clear favorite in the 25 May presidential elections. While two surveys project a comfortable victory for President Santos over right-wing Oscar Ivan Zuluaga of the Centro Democratico party in both rounds of voting, another poll sees center-left Enrique Penalosa of the Alianza Verde party as winner in the second round of elections. The centerpiece of President Santos’ administration has been the attempt to reach a peace accord with the FARC rebels, which he still sees as likely to be achieved in 2014.

LatinFocus Consensus Forecast panelists see the economy growing 4.5% in 2014, which is unchanged from last month’s forecast. For 2015, the panel sees economic growth at 4.6%.

Annual inflation edged up from 2.3% in February to 2.5% in March. At its meeting on 21 March, the Central Bank left the policy rate unchanged at 3.25%. Panelists expect inflation to close 2014 at 3.0%. In 2015, the panel sees inflation at 3.1%.

Outlook stable


2010-12 2013-15 2016-18Population (million): 46.1 47.7 49.4GDP (USD bn): 331 387 456GDP per capita (USD): 7,179 8,108 9,236GDP growth (%): 4.0 4.5 4.8Fiscal Balance (% of GDP): -2.5 -2.0 -1.4Public Debt (% of GDP): 33.1 33.4 30.8Inflation (%): 2.6 2.6 3.2Current Account (% of GDP): -3.1 -3.4 -3.1External Debt (% of GDP): 22.1 23.8 21.9

ColombiaColombia

Teresa KerstingEconomist


Note: Year-on-year changes of industrial production and annual average growth rate in %.Source: Colombia National Statistical Institute (DANE) and FocusEconomics calculations.

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%



April 2014

market expectations of a 0.30% price increase. The figure was mainly driven by price increases in the communication, food and health categories. Annual inflation rose from 2.3% in February to 2.5% in March, which marked the largest rate since November 2012.

The core inflation index, which excludes volatile items such as fresh food and fuels, rose 0.25% month-on-month in March (February: +0.55% month-on-month). Annual core inflation inched up from February’s 2.8% to 2.9% in March, thus still remaining within the Central Bank’s tolerance margin of plus/minus 1.0 percentage points around its 3.0% target.

LatinFocus Consensus Forecast participants expect that inflation will close 2014 at 3.0%, which is up 0.1 percentage points from last month’s forecast. For 2015, the panel expects inflation to end the year at 3.1%.

MONETARY SECTOR | Central Bank leaves key policy rate unchanged in March The Central Bank (BanRep) kept its reference interest rate unchanged at 3.25% at its 21 March monetary policy meeting. This decision was on par with market expectations. The key policy rate sits at the lowest level since February 2011, where it has remained since March 2013.

BanRep justified its decision by restating similar arguments provided in last month’s monetary policy meeting. The Bank left the annual growth outlook for the Colombian economy unchanged at 3.3% to 5.3%, and indicated that growth of 4.3% is the most likely value. As for the global growth outlook, the Central Bank pointed out that the economic recovery in advanced economies remains on track, while it underestimated the weakness in emerging markets. Furthermore, the Bank recognized that the Colombian peso weakened against the U.S. dollar because of a less accommodative international monetary policy. With respect to domestic developments, the Bank stressed that economic indicators indicate that both in the full year 2013 and in Q4 domestic growth was strong and mainly driven by domestic demand and investment. In terms of price developments, the Bank stated that annual inflation rose in February and remained within the Central Banks’s tolerance margin of plus/minus 1.0 percentage points around its 3.0% target. The next policy meeting is scheduled for 25 April.

LatinFocus Consensus Forecast panelists see the policy rate at 4.16% at the end of 2014. Panelists expect the policy rate to end 2015 at 4.83%.

EXTERNAL SECTOR | Exports continue to declineExports fell 8.5% over the same month last year in February, following the 1.5% contraction recorded in January. According to the National Statistical Office (DANE), the deterioration was due to a contraction in exports of fuel and products from extractive industries, as well as in manufacturing products.

Imports contracted 6.6% in January (the most recent month for which data are available), contrasting the 8.6% expansion recorded in December. The trade balance recorded a USD 69 million deficit in January, which was well above the USD 336 million deficit recorded in the same month of last year.

LatinFocus Consensus Forecast panelists expect that exports will expand 6.6% in 2014 and 7.2% in 2015.


Note: Year-on-year and month-on-month variation of cons. price index in %.Source: Colombia National Statistical Institute (DANE).

1.0

2.0

3.0

4.0

-0.5

0.0

0.5

1.0




%%


Note: Central Bank policy rate in %.Source: Colombia Central Bank.

2.0

4.0

6.0

8.0

10.0


%

Exports | variation in %

Note: Year-on-year and annual average variation in %.Source: Colombia National Statistical Office (DANE).

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40

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%



April 2014


Annual Data 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Real Sector Population (million) 45.0 45.5 46.1 46.6 47.2 47.7 48.3 48.9 49.4 50.0GDP per capita (USD) 5,209 6,308 7,284 7,946 8,017 7,967 8,338 8,739 9,207 9,761GDP (USD bn) 234 287 335 370 378 380 402 426 454 487Economic Growth (GDP, annual var. in %) 1.7 4.0 6.6 4.0 4.3 4.5 4.6 4.7 4.8 4.8Domestic Demand (annual var. in %) 0.2 5.6 8.6 4.6 4.9 5.0 5.1 5.3 5.5 5.7Total Consumption (annual var. in %) 1.6 5.1 5.5 4.7 4.8 4.5 4.5 4.6 4.7 5.0Private Consumption (annual var. in %) 0.6 5.0 6.0 4.4 4.5 - - - - -Government Consumption (annual var. in %) 5.9 5.6 3.6 5.7 6.0 - - - - -Fixed Investment (annual var. in %) -1.3 4.9 19.0 4.6 5.7 6.3 6.8 7.1 6.6 5.8Industrial Production (annual var. in %) -4.6 4.3 5.0 -0.2 -1.8 2.7 3.3 3.3 3.5 3.6Retail Sales (annual var. in %) -0.1 8.1 7.8 4.1 4.7 4.9 4.5 5.0 5.2 4.9Unemployment (% of active population, aop) 12.0 11.8 10.8 10.4 9.7 9.1 8.9 8.6 8.6 8.5Fiscal Balance (% of GDP) -3.7 -3.5 -2.0 -1.9 -2.2 -1.9 -1.8 -1.5 -1.4 -1.3Public Debt (% of GDP) 33.8 34.4 33.2 31.7 34.5 33.3 32.3 31.7 30.8 30.0Monetary and Financial Sector Money (annual var. of M2 in %) 5.4 10.2 18.9 16.5 14.7 - - - - -Inflation (CPI, annual var. in %, eop) 2.0 3.2 3.7 2.4 1.9 3.0 3.1 3.1 3.2 3.2Inflation (CPI, annual var. in %, aop) 4.2 2.3 3.4 3.2 2.0 2.6 3.1 3.1 3.1 3.2Inflation (Core, annual var. in %, eop) 3.7 3.2 3.9 3.2 2.7 - - - - -Inflation (PPI, annual var. in %, eop) -2.2 4.4 5.5 -3.0 -0.5 - - - - -Policy Interest Rate (%, eop) 3.50 3.00 4.75 4.25 3.25 4.16 4.83 5.11 5.08 5.0390-day DTF (%, eop) 4.11 3.47 4.98 5.27 4.07 4.61 5.44 5.59 5.70 5.8310-Year Bond Yield (%, eop) 8.50 7.68 7.63 5.55 6.83 6.65 6.95 6.81 6.75 6.71Stock Market (IGBC variation in %) 53.5 33.6 -18.3 16.2 -11.2 - - - - -Exchange Rate (COP per USD, eop) 2,043 1,920 1,939 1,767 1,930 2,007 2,045 2,076 2,100 2,108Exchange Rate (COP per USD, aop) 2,154 1,898 1,848 1,797 1,869 1,992 2,026 2,061 2,088 2,104External Sector Current Account Balance (% of GDP) -2.2 -3.1 -2.9 -3.2 -3.4 -3.5 -3.3 -3.2 -3.1 -3.0Current Account Balance (USD bn) -5.1 -8.9 -9.9 -11.8 -12.7 -13.1 -13.4 -13.6 -14.2 -14.6Trade Balance (USD bn) 0.0 -0.8 2.7 1.0 -0.6 0.8 0.8 0.6 0.7 0.0Exports (USD bn) 32.8 39.7 56.9 60.1 58.8 62.7 67.2 73.6 80.5 85.6Imports (USD bn) 32.9 40.5 54.2 59.1 59.4 61.9 66.4 73.1 79.7 85.7Exports (annual var. in %) -12.7 20.9 43.3 5.6 -2.2 6.6 7.2 9.5 9.3 6.4Imports (annual var. in %) -17.1 23.1 34.0 9.0 0.5 4.2 7.4 10.0 9.1 7.4International Reserves (USD bn) 25.4 28.5 32.3 37.5 43.6 46.1 48.0 49.7 52.1 56.6International Reserves (months of imports) 9.3 8.4 7.1 7.6 8.8 8.9 8.7 8.2 7.8 7.9External Debt (USD bn) 53.7 64.7 75.6 78.8 91.9 90.2 94.4 96.8 103.3 98.9External Debt (% of GDP) 22.9 22.5 22.5 21.3 24.3 23.7 23.5 22.7 22.8 20.3 Quarterly Data Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15Economic Growth (GDP, annual var. in %) 5.4 4.9 4.9 4.3 4.3 4.5 4.4 4.6 4.9 4.9Economic Growth (GDP, s.a. qoq var. in %) 0.8 0.8 - - - - - - - -Total Consumption (annual var. in %) 4.8 5.1 4.7 4.6 4.4 4.1 4.3 4.6 4.8 4.6Fixed Investment (annual var. in %) 11.3 8.0 7.2 6.8 6.4 5.8 5.8 7.1 8.4 8.5Industrial Production (annual var. in %) -1.3 0.3 3.2 2.2 2.8 3.3 3.4 3.1 3.4 4.1Unemployment (% of active population, aop) 9.4 8.2 10.2 9.4 9.1 8.8 9.3 8.9 8.5 7.9Inflation (CPI, annual var. in %, eop) 2.3 1.9 2.5 2.4 2.4 3.0 3.2 3.3 3.3 3.1Policy Interest Rate (%, eop) 3.25 3.25 3.25 3.38 3.85 4.16 4.38 4.54 4.76 4.8390-day DTF (%, eop) 4.06 4.07 3.88 4.08 4.32 4.61 4.75 4.88 5.23 5.44Exchange Rate (COP per USD, eop) 1,912 1,930 1,972 1,985 1,988 2,007 2,017 2,024 2,044 2,045Exchange Rate (COP per USD, aop) 1,908 1,913 2,005 1,978 1,987 1,998 2,012 2,021 2,034 2,045Current Account Balance (% of GDP) -4.0 -3.6 -3.2 -3.2 -3.7 -3.7 -3.4 -3.4 -3.4 -3.1Current Account Balance (USD bn) -3.8 -3.4 -2.9 -3.1 -3.6 -3.6 -3.4 -3.4 -3.5 -3.2Trade Balance (USD bn) -0.8 -0.3 0.2 0.4 0.0 0.6 0.3 0.4 0.5 -0.3Exports (USD bn) 14.5 15.1 15.4 15.9 16.0 16.5 16.3 16.7 17.1 17.8Imports (USD bn) 15.2 15.3 15.2 15.5 16.0 15.9 16.1 16.3 16.7 18.1 Monthly Data Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14Industrial Production (annual var. in %) -5.0 0.6 -3.4 -1.0 0.3 -0.8 1.5 -0.1 2.8 -Unemployment (% of active population) 9.2 9.9 9.3 9.0 7.8 8.5 8.4 11.1 10.7 -Cons. Conf. Index (0-point threshold) 27.4 25.1 13.4 14.6 22.3 23.1 23.2 26.6 15.7 -Inflation (CPI, mom variation in %) 0.23 0.04 0.08 0.29 -0.26 -0.22 0.26 0.49 0.63 0.39Inflation (CPI, annual var. in %) 2.2 2.2 2.3 2.3 1.8 1.8 1.9 2.1 2.3 2.5Exchange Rate (COP per USD, eop) 1,922 1,896 1,933 1,912 1,892 1,932 1,930 2,016 2,044 1,972Exports (annual variation in %) 6.7 -6.5 8.9 -1.2 -11.0 2.8 6.5 -1.5 -8.5 -



April 2014

0%

10%

20%

30%

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50%

< 3.7 3.9 4.1 4.3 4.5 4.7 4.9 5.1 > 5.1


1 | Real GDP | 2000 - 2018 | var. in %




Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (DANE, Departamento Administrativo Nacional de Estadistica). Forecasts based on LatinFocus Consensus Forecast.1 GDP, real annual variation in %. 2 Quarterly GDP (not seasonally adjusted), year-on-year variation in %.3 GDP, evolution of 2014 forecasts during the last 18 months.4 GDP, evolution of 2015 forecasts during the last 18 months.5 GDP, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval in


Individual Forecasts 2014 2015ANIF 4.6 4.5Banco Bradesco 4.2 4.3Banco CorpBanca 4.7 5.0Banco de Bogotá 4.5 5.0Bancolombia 4.4 4.6Barclays Capital 4.8 4.5BBVA Research 4.7 5.1BofA Merrill Lynch 4.4 4.8BTG Pactual 4.5 4.5Capital Economics 3.8 3.8Citigroup Global Mkts 4.6 5.0Corficolombiana 5.0 5.0Corredores Asociados 4.5 5.2Credicorp Capital 4.6 5.1Credit Suisse 4.5 4.9Deutsche Bank 4.5 4.3EIU 4.7 4.5Fedesarrollo 4.6 4.6Goldman Sachs 4.4 4.5Helm Bank 4.7 5.0HSBC 4.7 4.5Itaú BBA 4.5 4.5JPMorgan 4.6 4.5Nomura 4.5 4.6Polinomics 4.5 -Santander 4.5 4.2UBS 4.2 4.1Ultrabursátiles 4.2 4.5SummaryMinimum 3.8 3.8Maximum 5.0 5.2Median 4.5 4.5Consensus 4.5 4.6History30 days ago 4.5 4.660 days ago 4.5 4.690 days ago 4.5 4.6Additional ForecastsIMF (Apr. 2014) 4.5 4.5World Bank (Jan. 2014) 4.3 4.2Central Bank (Mar. 2014) 3.3-5.3 -

-5

0

5

10

2000 2005 2010 2015

ColombiaLatin AmericaWorld

0

3

6

9

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

ColombiaLatin AmericaWorld

3

4

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6



3

4

5

6






April 2014



6

7

8

9

10

11


2014 2015


-10

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10

20

2000 2005 2010 2015

ColombiaLatin America


4.3

4.5

4.7

4.9

5.1


2014 2015


0

2

4

6

8

2000 2005 2010 2015



Individual Forecasts 2014 2015 2014 2015ANIF 4.2 4.0 5.0 6.0Banco Bradesco - - - -Banco CorpBanca - - - -Banco de Bogotá 5.0 5.0 - -Bancolombia - - - -Barclays Capital 4.3 4.1 - -BBVA Research 4.4 4.6 6.6 7.6BofA Merrill Lynch 3.9 4.4 4.6 5.1BTG Pactual 4.3 4.2 5.4 6.0Capital Economics - - 7.5 6.0Citigroup Global Mkts 4.4 5.5 4.6 3.3Corficolombiana 4.7 - 8.5 -Corredores Asociados - - - -Credicorp Capital 4.5 4.5 5.1 11.3Credit Suisse 4.5 4.5 - -Deutsche Bank 4.4 4.6 - -EIU 4.6 4.4 5.8 7.0Fedesarrollo 4.4 4.1 4.4 6.1Goldman Sachs - - - -Helm Bank - - - -HSBC 4.5 4.5 8.7 8.5Itaú BBA - - - -JPMorgan - - - -Nomura 4.8 5.1 6.5 6.0Polinomics - - - -Santander 4.2 4.0 8.4 8.0UBS - - - -Ultrabursátiles 4.8 5.1 6.8 7.2SummaryMinimum 3.9 4.0 4.4 3.3Maximum 5.0 5.5 8.7 11.3Median 4.4 4.5 6.2 6.1Consensus 4.5 4.5 6.3 6.8History30 days ago 4.4 4.5 7.0 7.460 days ago 4.4 4.5 7.0 7.490 days ago 4.6 4.6 6.9 7.3

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (DANE, Departamento Administrativo Nacional de Estadistica). Forecasts based on LatinFocus Consensus Forecast.6 Total consumption, annual variation in %. 7 Total consumption, evolution of 2014 and 2015 forecasts during the last 18 months.8 Gross fixed investment, annual variation in %.9 Gross fixed investment, evolution of 2014 and 2015 forecasts during the last 18 months.




April 2014



Individual Forecasts 2014 2015 2014 2015 2014 2015ANIF 2.7 3.5 9.3 9.1 -2.3 -2.2Banco Bradesco - - - - - -Banco CorpBanca - - - - - -Banco de Bogotá 3.8 3.5 - - - -Bancolombia - - - - -2.4 -2.2Barclays Capital - - - - -1.2 -0.9BBVA Research 2.3 3.4 - - -2.3 -2.1BofA Merrill Lynch - - 8.7 8.4 -2.4 -2.3BTG Pactual - - 9.4 9.4 -2.3 -2.2Capital Economics 2.0 2.0 - - - -Citigroup Global Mkts - - - - -1.3 -0.7Corficolombiana 3.4 - 9.0 - -1.0 -0.8Corredores Asociados - - - - - -Credicorp Capital 2.7 5.0 - - -1.0 -0.8Credit Suisse - - 9.5 9.5 -1.3 -1.4Deutsche Bank - - - - -2.3 -2.2EIU 0.5 1.0 9.3 9.1 - -Fedesarrollo 4.5 4.2 9.1 8.9 -2.4 -2.3Goldman Sachs - - - - -2.3 -2.0Helm Bank - - - - - -HSBC 4.8 5.0 9.0 9.0 -1.2 -1.0Itaú BBA - - 8.5 8.0 -2.1 -1.9JPMorgan - - - - -1.2 -Nomura - - - - -2.3 -2.2Polinomics - - 9.5 - - -Santander 1.5 2.8 9.0 8.5 -2.3 -2.0UBS 2.5 2.7 9.4 9.3 -2.3 -2.2Ultrabursátiles 2.0 - 9.0 8.5 -2.3 -2.2SummaryMinimum 0.5 1.0 8.5 8.0 -2.4 -2.3Maximum 4.8 5.0 9.5 9.5 -1.0 -0.7Median 2.6 3.5 9.1 9.0 -2.3 -2.1Consensus 2.7 3.3 9.1 8.9 -1.9 -1.8History30 days ago 2.8 3.3 9.1 8.9 -1.8 -1.760 days ago 2.8 3.3 9.1 8.8 -1.8 -1.690 days ago 2.6 3.1 9.3 9.0 -1.8 -1.7

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (DANE, Departamento Administrativo Nacional de Estadistica) and the Central Bank (BanRep, Banco de la Republica). See below for details. Forecasts based on LatinFocus Consensus Forecast.10 Industrial production, annual variation in %. Source: DANE.11 Industrial production, evolution of 2014 and 2015 forecasts during the last 18 months.12 Unemployment, % of active population. Source: DANE.13 Central government balance as % of GDP. Source: BanRep.



-6

-4

-2

0

2000 2005 2010 2015

Colombia

Latin America


5

10

15

20

2000 2005 2010 2015



2

3

4

5


2014 2015


-10

-5

0

5

10

15

2000 2005 2010 2015




April 2014

0%

20%

40%

60%

< 2.2 2.4 2.6 2.8 3.0 3.2 3.4 3.6 > 3.6


14 | Inflation | 2000 - 2018 | in %


15 | Inflation | Q1 11-Q4 15 | in %


Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the National Statistical Institute (DANE, Departamento Administrativo Nacional de Estadistica). Forecasts are based on LatinFocus Consensus Forecast.14 Inflation, annual variation of consumer price index (CPI) in % (eop). 15 Quarterly inflation, annual variation of consumer price index (CPI) in % (eop).16 Inflation, evolution of 2014 forecasts during the last 18 months.17 Inflation, evolution of 2015 forecasts during the last 18 months.18 Inflation, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval


Individual Forecasts 2014 2015ANIF 3.0 3.0Banco Bradesco - -Banco CorpBanca 3.1 3.2Banco de Bogotá 2.9 3.0Bancolombia 2.8 3.4Barclays Capital 3.2 3.0BBVA Research 3.1 3.1BofA Merrill Lynch 2.8 2.7BTG Pactual 3.2 3.3Capital Economics 2.3 3.0Citigroup Global Mkts 2.8 3.5Corficolombiana 3.0 3.0Corredores Asociados - -Credicorp Capital 3.0 3.4Credit Suisse 3.1 3.4Deutsche Bank 3.0 3.6EIU 3.4 3.0Fedesarrollo 3.3 3.4Goldman Sachs 3.0 3.0Helm Bank 3.0 3.0HSBC 3.1 3.0Itaú BBA 2.9 3.0JPMorgan 2.9 3.0Nomura 2.6 3.0Polinomics 3.1 -Santander 3.0 2.9UBS 3.0 3.1Ultrabursátiles 2.9 3.0SummaryMinimum 2.3 2.7Maximum 3.4 3.6Median 3.0 3.0Consensus 3.0 3.1History30 days ago 2.9 3.160 days ago 2.9 3.190 days ago 3.0 3.1Additional ForecastsIMF (Apr. 2014) 2.7 3.0Central Bank (Nov. 2013) 3.0 3.0



2.0

2.5

3.0

3.5

4.0



0

4

8

12

2000 2005 2010 2015


2.0

2.5

3.0

3.5

4.0



0

3

6

9

12

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15




April 2014

0%

20%

40%

60%

< 2.50 3.00 3.50 4.00 4.50 5.00 5.50 6.00 > 6.00


19 | Interest Rate | 2000 - 2018 | in %




Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the Central Bank (BanRep, Banco de la Republica). Forecasts are based on LatinFocus Consensus Forecast.19 Interest rate, Central Bank policy rate in % (eop).20 Quarterly interest rate, Central Bank policy rate in % (eop).21 Interest rate, evolution of 2014 forecasts during the last 18 months.22 Interest rate, evolution of 2015 forecasts during the last 18 months.23 Interest rate, panelist distribution of 2014 forecasts. Concentration of panelists in forecast


Individual Forecasts 2014 2015ANIF 4.50 5.00Banco Bradesco - -Banco CorpBanca 4.50 5.00Banco de Bogotá 4.25 5.25Bancolombia 4.00 4.50Barclays Capital 4.75 5.00BBVA Research 4.25 5.25BofA Merrill Lynch 3.25 5.00BTG Pactual 4.25 4.75Capital Economics 3.75 4.50Citigroup Global Mkts 4.00 5.00Corficolombiana 4.75 5.00Corredores Asociados 3.75 -Credicorp Capital 4.50 5.25Credit Suisse 4.50 5.00Deutsche Bank 3.75 -EIU - -Fedesarrollo 4.50 4.75Goldman Sachs 4.25 5.00Helm Bank 4.50 5.00HSBC 4.00 5.00Itaú BBA 3.75 4.25JPMorgan 4.50 -Nomura 3.25 4.50Polinomics - -Santander 4.75 4.75UBS 3.50 3.75Ultrabursátiles 4.25 4.75SummaryMinimum 3.25 3.75Maximum 4.75 5.25Median 4.25 5.00Consensus 4.16 4.83History30 days ago 4.19 4.8760 days ago 4.19 4.8690 days ago 4.20 4.88



2

3

4

5

6

7



0

4

8

12

16

2000 2005 2010 2015


2

3

4

5

6

7



2

4

6

8

10

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15




April 2014

0%

10%

20%

30%

40%

50%

< 1,800 1,850 1,900 1,950 2,000 2,050 2,100 2,150 > 2,150


24 | Exchange Rate | COP per USD

26 | COP per USD 2014 | evol. of fcst

25 | Exchange Rate | COP per USD

27 | COP per USD 2015 | evol. of fcst

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from Thomson Reuters. Forecasts based on LatinFocus Consensus Forecast.24 Exchange rate, COP per USD (eop).25 Quarterly exchange rate, COP per USD (eop).26 Exchange rate, evolution of 2014 forecast during the last 18 months.27 Exchange rate, evolution of 2015 forecast during the last 18 months.28 Exchange rate, panelist distribution of 2014 forecasts. Concentration of panelists in forecast


Individual Forecasts 2014 2015ANIF - -Banco Bradesco 2,000 2,040Banco CorpBanca 2,000 2,050Banco de Bogotá 2,000 2,050Bancolombia 2,025 2,150Barclays Capital 2,000 2,000BBVA Research 1,960 1,980BofA Merrill Lynch 2,070 2,100BTG Pactual 2,050 2,100Capital Economics - -Citigroup Global Mkts 2,150 2,150Corficolombiana 1,875 1,925Corredores Asociados 2,040 -Credicorp Capital 1,950 1,950Credit Suisse 1,985 1,968Deutsche Bank 1,970 -EIU 2,097 2,127Fedesarrollo 1,948 1,961Goldman Sachs 2,150 2,204Helm Bank 2,000 2,000HSBC 1,960 2,000Itaú BBA 2,000 2,015JPMorgan - -Nomura 1,960 2,100Polinomics - -Santander 2,090 2,150UBS 1,900 1,875Ultrabursátiles 2,000 2,100SummaryMinimum 1,875 1,875Maximum 2,150 2,204Median 2,000 2,045Consensus 2,007 2,045History30 days ago 2,008 2,03860 days ago 1,988 2,03090 days ago 1,968 2,015

28 | COP per USD 2014 | Panelist Distribution

Exchange Rate | COP per USD

1,600

1,800

2,000

2,200

2,400



1,500

2,000

2,500

3,000

2000 2005 2010 2015

1,600

1,800

2,000

2,200

2,400

2,600



1,750

1,850

1,950

2,050

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15



April 2014


0

1

2

3

4

5


2014 2015


-25

0

25

50

75

100

2000 2005 2010 2015

Trade BalanceImportsExports


-4

-2

0

2

2000 2005 2010 2015



-4.0

-3.5

-3.0

-2.5


2014 2015


Current Account and Trade Balance Current Account Trade Balance

% of GDP USD bnIndividual Forecasts 2014 2015 2014 2015ANIF -3.7 -3.8 2.0 1.7Banco Bradesco - - - -Banco CorpBanca - - - -Banco de Bogotá -4.6 - -1.4 -Bancolombia -3.4 -3.2 - -Barclays Capital -3.6 -3.5 1.5 1.2BBVA Research -3.1 -3.1 3.1 1.9BofA Merrill Lynch -4.7 -4.7 0.4 0.6BTG Pactual -3.4 -3.4 -1.8 -3.2Capital Economics -4.0 -3.5 1.0 3.0Citigroup Global Mkts -3.5 -3.6 - -Corficolombiana -3.3 -3.2 - -Corredores Asociados - - - -Credicorp Capital -3.3 -3.2 2.4 1.4Credit Suisse -3.5 -3.5 - -Deutsche Bank -2.7 -3.0 - -EIU -3.6 -3.6 -1.8 -2.1Fedesarrollo -3.2 -3.4 - -Goldman Sachs -2.9 -2.7 -0.5 -0.8Helm Bank - - - -HSBC -3.7 -3.3 1.7 0.5Itaú BBA -3.4 -3.0 - -JPMorgan -3.5 - - -Nomura -3.3 -3.5 - -Polinomics - - - -Santander -3.4 -3.3 2.1 2.0UBS -2.5 -2.3 0.3 0.3Ultrabursátiles -3.1 -3.0 2.9 3.9SummaryMinimum -4.7 -4.7 -1.8 -3.2Maximum -2.5 -2.3 3.1 3.9Median -3.4 -3.3 1.2 1.2Consensus -3.5 -3.3 0.8 0.8History30 days ago -3.5 -3.3 0.8 0.760 days ago -3.3 -3.0 1.4 1.990 days ago -3.5 -3.5 1.4 0.5

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (BanRep, Banco de la Republica). Forecasts based on LatinFocus Consensus Forecast.29 Current account balance, as % of GDP. 30 Current account balance, evolution of 2014 and 2015 forecasts during the last 18 months.31 Trade balance, exports and imports, in USD. 32 Trade balance, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014



Individual Forecasts 2014 2015 2014 2015ANIF 58.7 60.5 56.8 58.8Banco Bradesco - - - -Banco CorpBanca - - - -Banco de Bogotá 59.5 - 60.9 -Bancolombia - - - -Barclays Capital 63.4 69.0 61.9 67.8BBVA Research 65.5 72.0 62.4 70.1BofA Merrill Lynch 61.7 65.3 61.3 64.7BTG Pactual 61.1 63.9 63.0 67.1Capital Economics 62.0 66.0 61.0 63.0Citigroup Global Mkts - - - -Corficolombiana - - - -Corredores Asociados - - - -Credicorp Capital 63.5 69.9 61.1 68.5Credit Suisse - - - -Deutsche Bank - - - -EIU 59.0 60.9 60.7 63.0Fedesarrollo - - - -Goldman Sachs 62.6 66.2 63.1 67.0Helm Bank - - - -HSBC 66.0 69.9 64.3 69.4Itaú BBA - - - -JPMorgan - - - -Nomura - - - -Polinomics - - - -Santander 67.4 73.8 65.3 71.8UBS 65.9 71.8 65.6 71.5Ultrabursátiles 61.7 64.8 58.9 60.9SummaryMinimum 58.7 60.5 56.8 58.8Maximum 67.4 73.8 65.6 71.8Median 62.3 66.2 61.6 67.1Consensus 62.7 67.2 61.9 66.4History30 days ago 63.8 68.4 63.0 67.760 days ago 65.0 70.0 63.5 68.190 days ago 65.9 67.8 64.5 67.3

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (BanRep, Banco de la Republica). Forecasts based on LatinFocus Consensus Forecast.33 Exports, annual variation in %. 34 Exports, evolution of 2014 and 2015 forecasts during the last 18 months.35 Imports, annual variation in %. 36 Imports, evolution of 2014 and 2015 forecasts during the last 18 months.

60

65

70

75

80


2014 2015


-40

-20

0

20

40

2000 2005 2010 2015



-40

-20

0

20

40

60

2000 2005 2010 2015



60

65

70

75

80

85


2014 2015




April 2014


80

85

90

95

100


2014 2015


10

20

30

40

50

2000 2005 2010 2015

Colombia

Latin America


4

6

8

10

12

2000 2005 2010 2015



42

44

46

48

50


2014 2015



USD bn USD bnIndividual Forecasts 2014 2015 2014 2015ANIF 49.8 56.3 - -Banco Bradesco - - - -Banco CorpBanca - - - -Banco de Bogotá 45.6 - - -Bancolombia - - - -Barclays Capital 45.1 46.1 95.2 104.7BBVA Research 47.6 51.6 - -BofA Merrill Lynch 46.0 43.6 98.1 107.8BTG Pactual - - - -Capital Economics - - - -Citigroup Global Mkts 47.7 51.3 93.5 97.5Corficolombiana - - - -Corredores Asociados - - - -Credicorp Capital 47.8 48.5 - -Credit Suisse 46.1 47.3 88.9 91.3Deutsche Bank 44.0 46.0 90.0 95.0EIU 45.6 46.9 82.2 84.3Fedesarrollo 48.1 51.3 92.4 95.2Goldman Sachs 43.2 42.9 90.3 92.9Helm Bank - - - -HSBC 45.9 43.0 84.3 86.5Itaú BBA 47.8 50.0 - -JPMorgan 41.0 - - -Nomura - - - -Polinomics - - - -Santander - - 88.4 90.2UBS - - - -Ultrabursátiles 46.4 47.0 88.9 92.6SummaryMinimum 41.0 42.9 82.2 84.3Maximum 49.8 56.3 98.1 107.8Median 46.0 47.1 90.0 92.9Consensus 46.1 48.0 90.2 94.4History30 days ago 45.4 47.4 89.8 94.060 days ago 46.0 47.9 89.1 93.490 days ago 46.0 47.5 88.6 94.1

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (BanRep, Banco de la Republica). Forecasts based on LatinFocus Consensus Forecast.38 International reserves, months of imports. 39 International reserves, evolution of 2014 and 2015 forecasts during the last 18 months.40 External debt as % of GDP. 41 External debt, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014

Colombia in the Region


Fact Sheet

Colombia6.5%

Brazil39.6%

Mexico20.9%

Argentina8.4%

Venezuela6.7%

Other17.9%

Colombia7.9%

Brazil33.7%

Mexico19.9%

Argentina7.0%

Peru5.2%

Other26.3%

U.S.A.24.2%

EU-2713.2%

Other Asia ex-Japan

6.4%China16.3%

Other LatAm16.9%

Mexico10.9%

Other12.2%

U.S.A.36.6%

EU-2715.1%China

5.5%

LatAm27.3%

Other15.4%

Other4.4%


Mineral Fuels5.4%

Food9.8%

Other4.8%


Mineral Fuels59.8%

Food12.7%

Trade Structure



Economic Structure


Exports

Exports

Imports

Imports

-20

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

0

20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



• Ongoing domestic armed conflict

• Political consensus on economic policy• Constitutional status with the aim of controlling inflation

• Vulnerability to downward shifts in international commodity prices

• Consolidated financial system • Large shadow economy and capital flight

Energy (2010)Primary Energy Production (trillion Btu): 4,506Primary Energy Consumption (trillion Btu): 1,367Electricity Generation (billion kW-h): 55.3Electricity Consumption (billion kW-h): 45.4Oil Supply (thousand bpd): 806Oil Consumption (thousand bpd): 268CO2 Emmissions (million metric tons): 66.0

Agency Rating OutlookMoody’s: Baa3 PositiveS&P: BBB StableFitch Ratings: BBB Stable

Telecommunication (2012) Telephones - main lines (per 100 inhabitants): 13.2Telephones - mobile cellular (per 100 inhabit.): 103.2Internet Users (per 100 inhabitants): 49.0Broadband Subscriptions (per 100 inhabitants): 8.4

Transportation (2012) Airports: 862Railways (km): 874Roadways (km): 141,374Waterways (km): 24,725Chief Ports: Barranquilla, Buenaventura

Official name: Republic of ColombiaCapital: Bogota (6.3m)Other cities: Medellin (3.3m)

Cali (3.1m)Area (km2): 1,138,910Population (million, 2013 est.): 47.2Population density (per km2, 2012 est.): 41.4Population growth rate (%, 2012 est.): 1.1Life expectancy (years, 2012 est.): 74.8Illiteracy rate (%, 2005): 9.6Language: Spanish & IndigenousMeasures: Metric systemTime: GMT-5

President: Juan Manuel SantosLast elections: 20 June 2010Next elections: 25 May 2014Central Bank President: Jose Dario Uribe Escobar

FOCUSECONOMICS Mexico


April 2014

REAL SECTOR | Economic activity decelerates in JanuaryEconomic activity increased 0.8% over the same month last year in January according to INEGI’s IGAE (Indicador Global de la Actividad Economica). The reading came in below the 1.4% increase the market had expected and marked a deceleration over the 1.1% expansion registered in December.

January’s result primarily reflected a deterioration in agriculture (January: -1.7% year-on-year; December: +1.2% yoy) and a deceleration in services (January: +1.0% yoy; December: +1.9% yoy). Conversely, industry increased 0.7% annually in January (December: -0.3% yoy), which marked the fastest pace of expansion in nine months.

A month-on-month comparison, however, does not corroborate the deceleration suggested by the annual data. In January, economic activity expanded a seasonally-adjusted 0.1%. The reading contrasted the 0.3% contraction registered in December. The trend, nonetheless, still points downward. Annual average growth in economic activity fell from 1.1% in December to 0.9% in January, which marked the slowest pace in more than three years.

The Central Bank (Banxico) expects the economy to grow between 3.0% and 4.0% in 2014. For 2015, the Bank sees economic growth to average between 3.2% and 4.2%. Meanwhile, the Finance Ministry (Secretaria de Hacienda) expects the economy to expand 3.9% this year and to accelerate to a 4.7% increase in 2015. At this forecast rate, the economy would grow at the fastest since 2010.



2010-12 2013-15 2016-18Population (million): 116 119 123GDP (USD bn): 1,135 1,352 1,664GDP per capita (USD): 9,805 11,319 13,522GDP growth (%): 4.3 2.7 3.9Fiscal Balance (% of GDP): -2.6 -3.0 -2.5Public Debt (% of GDP): 34.6 38.2 42.0Inflation (%): 3.9 3.8 3.4Current Account (% of GDP): -0.9 -1.9 -2.0External Debt (% of GDP): 18.7 19.3 19.0

MexicoMexico

Ricardo AcevesSenior Economist

Data for economic activity in January showed that the economy started off the year on a slow footing, but leading indicators in March suggest that growth is gradually gaining momentum. In addition, news regarding the external sector was fairly positive. The February trade balance incurred a larger-than-expected surplus, due to strong export growth. On 21 March, state-owned firm Pemex submitted to the Energy Ministry the so-called Round Zero list of the oil fields in which it would like to continue operating, once the energy market is open to private investment. The move represents the first concrete step to end Pemex’s 75-year monopoly. Changes to the by-laws of the energy reform are still under discussion in Congress and are expected to be approved by the end of April.

LatinFocus panelists expect the economy to expand 3.1% in 2014. For 2015, the panel sees GDP growth accelerating to 3.9%.

Inflation fell from 4.2% in February to 3.8% in March. On 21 March, the Central Bank left the monetary policy rate unchanged at 3.50%. Panelists expect inflation to end 2014 at 3.9% and 2015 at 3.5%.


Note: Year-on-year and annual average growth rate of monthly economic activity in %.Source: Mexico National Statistical Institute (INEGI) and FocusEconomics calculations.

-2.0

0.0

2.0

4.0

6.0

8.0

Jan-12 Jul-12 Jan-13 Jul-13 Jan-14

Year-on-year (left scale)

Annual average (right scale)

%



April 2014

LatinFocus Consensus Forecast panelists are less optimistic than the Finance Ministry and project the economy to increase 3.1% in 2014, which is down 0.1 percentage points from last month’s forecast. For 2015, the panel expects growth to pick up to 3.9%.

OUTLOOK | PMI reaches 19-month high in MarchThe manufacturing indicator elaborated by the Mexican Institute of Finance Executives (IMEF) rose from 50.4 points in February to 52.7 points in March in seasonally adjusted terms. The result represented the strongest increase since August 2012 and overshot the 51.0 points the market had expected. The index remains above the 50-point threshold that separates expansion from contraction in the manufacturing sector.

March’s better-than-expected result reflected an improvement in almost all sub-categories that comprise the index. Notable improvements were recorded in new orders and employment, which reached levels last seen 19 and 16 months ago, respectively. Production levels rose to the highest level in 14 months in March and the sub-index of inventories recorded a mild improvement over the previous month. Only supply deliveries deteriorated in March, remaining in contracting territory for a third consecutive month.

The Mexican manufacturing sector is strongly linked to the manufacturing sector in the United States, where the ISM manufacturing index also increased in March, coming in at 53.7 points (February: 53.2 points). March’s increase confirms that the growth in the U.S. manufacturing sector is gradually gaining momentum, which bodes well for the Mexican manufacturing sector in the months ahead.

LatinFocus Consensus Forecast panelists expect Mexican industrial production to increase 3.0% in 2014, which is up 0.1 percentage points over the previous month’s projection. Panelists see industrial production expanding 3.9% in 2015.

OUTLOOK | Consumer confidence rises notably in MarchSentiment among consumers improved markedly in March, according to the INEGI’s unadjusted index of consumer confidence. The indicator climbed from 84.5 points in February to 88.8 points, which marked the highest level since December 2013. The reading overshot the 85.5 points the market had expected.

March’s better-than-expected result showed that households were more optimistic regarding both their own economic situation and their economic prospects. In addition, consumers reported that they were slightly more optimistic about the country’s overall economic situation and its economic prospects. Moreover, respondents to the March survey reported more optimism regarding their ability to buy big-ticket items.

LatinFocus Consensus Forecast panelists expect private consumption to grow 3.1% in 2014, which is down 0.3 percentage points from last month’s projections. For 2015, the panel sees private consumption expanding 4.0%.

MONETARY SECTOR | Inflation drops in March, returns to target rangeIn March, consumer prices added 0.27% over the previous month. The reading came in slightly above the 0.25% rise observed in February but fell short of the 0.30% increase expected by the markets. According to the National Statistics

Manufacturing Index

Note: Composite index in the manufacturing report on business (PMI) for the U.S. and seasonally-adjusted manufacturing index for Mexico. Readings above 50 points indicate an expansion in the manufacturing sector while readings below 50 points indicate to a contraction.Source: Institute for Supply Management (ISM) and Mexican Institute of Financial Executives (IMEF, Instituto Mexicano de Ejecutivos de Finanzas).

45

50

55

60


Mexico Manufacturing Index

U.S. Manufacturing Index

Consumer Confidence

Note: Seasonally adjusted consumer confidence index (ICC, Indicador de Confianza del Consumidor). January 2003=100.Source: Mexico National Statistical Institute (INEGI).

80

85

90

95

100

105




April 2014

Institute (INEGI), higher non-core prices, particularly for agricultural products were the main drivers behind the monthly increase.

Annual headline inflation fell from 4.2% in February to 3.8% in March, which marked the lowest level since November 2013. As a result, inflation returned to the Central Bank’s inflation target of 3.0% with a 1.0% tolerance margin. Core consumer prices, which do not take into account prices for fresh food, fuels and regulated prices, increased 0.21% over the previous month (February: +0.28% month-on-month), driving annual core inflation to 2.9% in March (February: 3.0% year-on-year).

The Central Bank indicated that by the end of 2014, inflation is expected to close the year below its 4.0% target ceiling. For 2015, the Banxico expects inflation to end slightly above its target of 3.0%. LatinFocus Consensus Forecast panelists expect inflation to end 2014 at 3.9%, which is unchanged over last month’s forecast. For 2015, the panel sees year-end inflation at 3.5%.

MONETARY SECTOR | Central Bank leaves interest rate unchangedAt its 21 March monetary policy meeting, the Central Bank (Banxico) decided to maintain the overnight target interest rate at 3.50%. The decision, which was in line with market expectations, followed similar conclusions at the Bank’s previous meetings that took place in January and in December.

The Central Bank stated that global economic activity continued to show signs of improving at the outset of this year and, on balance, the economic outlook for the global economy is still positive, although some downward risks persist. Domestically, the Bank underlined the deceleration in economic growth in the final quarter of 2013 and at the beginning of 2014. The Bank stated that growth in domestic demand is still lackluster, particularly in consumption and investment. As in its previous meeting’s statement, Banxico acknowledged that although positive signs for employment are beginning to emerge, it recognized that a degree of slack still persists in both the labor market and the economy as a whole. Monetary authorities concluded that, so far, clear signs of a notorious improvement have not been observed while they pointed out that they do not expect inflationary pressures arising from this performance.

Regarding price developments, the Banxico stated that inflation spiked at the beginning of 2014. However, monetary authorities pointed out that the increase had been a one-time event as a result of an increase in fares and new taxes on a number of consumer goods. Consequently, the Central Bank underlined that these developments are temporary. Alonso Cervera, Chief Latin America Economist at Credit Suisse said:

The central bank is comfortably on hold. This is occurring in a context of still tentative signs of a recovery and inflation in check after a temporary spike due to new taxes.

LatinFocus Consensus Forecast panelists expected the overnight policy rate to end 2014 at 3.59%. For 2015, the majority of LatinFocus Consensus Forecast participants expect the Central Bank to tighten the reins and raise the overnight policy rate to an average Consensus of 4.17%.

EXTERNAL SECTOR | Remittances increase for third consecutive monthIn February, remittances from Mexican workers abroad totaled USD 1.68 billion. The print came in above the USD 1.58 billion registered in the same


Note: Banxico target rate (Tasa objetivo de fondeo bancario) in %.Source: Mexico Central Bank (Banxico).

3.0

4.0

5.0

6.0

7.0

8.0

9.0


%


Note: Year-on-year and monthly variation of consumer price index in %.Source: Mexico National Statistical Institute (INEGI).

3.0

4.0

5.0

6.0

-0.5

0.0

0.5

1.0




%%



April 2014

month last year but fell short of the USD 1.70 billion the market had expected. February’s result represented a 5.7% expansion in annual terms (January: +8.8% year-on-year) and the third consecutive increase.

In the 12-months up to February, remittances totaled USD 21.8 billion, which constituted a 1.8% decrease over the same period last year (January: -3.0% yoy). At the current level, remittances are well below the USD 26.1 billion peak observed in 2007.

Given the fact that the U.S. labor market is showing signs of a gradual recovery, LatinFocus Consensus Forecast panelists expect remittances to reach USD 22.3 billion in 2014. For 2015, the panel sees remittances rising to USD 23.4 billion.

EXTERNAL SECTOR | Trade balance records surplus on strong exportsIn February, the trade balance incurred a USD 976 million surplus. The reading was well above the USD 80 million surplus registered in the same month last year and contrasted the USD 200 million deficit that the market had expected.

February’s unexpected trade surplus was the result of stronger exports. Overseas sales totaled USD 30.5 billion in February, which represented a 4.7% expansion compared to the same month last year (January: -1.0% year-on-year). According to the Statistical Institute (INEGI), shipments of petroleum products drove the increase. Meanwhile, imports totaled USD 29.5 billion in February, which represents a 1.6% increase over the same month last year (January: +0.3% yoy).

LatinFocus Consensus Forecast panelists expect exports to increase 6.6%, reaching USD 405 billion, while imports are expected to rise 8.1% and reach USD 412 billion. For 2015, the panel expects exports and imports to increase 7.8% and 8.1% respectively.

Merchandise Trade

Note: 12-month sum of trade balance in USD billion and annual variation of the12-month sum of exports and imports in %.Source: Mexico National Statistical Institute (INEGI).

0

10

20

30

40

-9

-6

-3

0

3



%

Remittances - U.S. Payrolls | variation in %

Note: Year-on-year variation of remittances from Mexican workers abroad and U.S. non-farm payrolls.Source: Mexico Central Bank (Banxico) and U.S. Bureau of Labor.

-6.0

-4.0

-2.0

0.0

2.0

4.0

-45

-30

-15

0

15

30

Feb-09 Feb-10 Feb-11 Feb-12 Feb-13 Feb-14

Remittances (yoy, left scale)

U.S. nonfarm payrolls (yoy, right scale)

%%



April 2014


Annual Data 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Real Sector Population (million) 111 114 116 117 118 119 121 122 123 124GDP per capita (USD) 8,096 9,201 10,093 10,122 10,656 11,218 12,082 12,790 13,506 14,271GDP (USD bn) 896 1,052 1,168 1,185 1,260 1,339 1,457 1,558 1,662 1,773Economic Growth (GDP, annual var. in %) -4.7 5.1 4.0 3.9 1.1 3.1 3.9 3.9 4.0 4.0Domestic Demand (annual var. in %) -6.6 5.1 3.9 3.8 1.0 3.7 4.3 4.3 4.5 4.5Private Consumption (annual var. in %) -6.5 5.3 4.9 4.7 2.5 3.1 4.0 4.2 4.2 4.3Government Consumption (ann. var. in %) 2.3 1.7 2.5 3.3 1.1 - - - - -Fixed Investment (annual var. in %) -9.3 1.3 7.9 4.6 -1.8 4.5 5.8 5.5 5.7 5.6Industrial Production (annual var. in %) -6.2 4.6 3.4 2.6 -0.7 3.0 3.9 4.0 4.2 4.4Retail Sales (annual var. in %) -4.3 2.4 3.5 3.7 -0.3 2.6 3.4 3.8 4.0 4.2Unemployment (% of active population, aop) 5.5 5.4 5.2 5.0 4.9 4.7 4.6 4.6 4.5 4.5Fiscal Balance (% of GDP) -2.3 -2.8 -2.4 -2.6 -2.3 -3.6 -3.1 -2.7 -2.4 -2.5Public Debt (% of GDP) 34.3 33.5 34.9 35.3 38.4 37.5 38.7 41.4 42.0 42.7Monetary and Financial Sector Money (annual variation of M2 in %) 6.4 8.0 11.9 8.4 8.8 - - - - -Inflation (CPI, annual var. in %, eop) 3.6 4.4 3.8 3.6 4.0 3.9 3.5 3.4 3.4 3.4Inflation (CPI, annual var. in %, aop) 5.3 4.2 3.4 4.1 3.8 4.0 3.7 3.4 3.4 3.4Inflation (Core, annual var. in %, eop) 4.2 3.6 3.4 2.9 2.8 - - - - -Inflation (PPI, annual var. in %, eop) 4.1 4.4 7.8 1.2 1.3 - - - - -Banxico Target Rate (%, eop) 4.50 4.50 4.50 4.50 3.50 3.59 4.17 4.88 5.31 5.38TIIE 28 Days Rate (%, eop) 4.93 4.89 4.80 4.84 3.79 3.95 4.42 4.93 5.38 5.5810-Year Bond Yield (%, eop) 3.35 2.71 2.46 1.49 2.54 6.50 6.76 6.85 7.00 7.02Stock Market (variation of IPC in %) 43.5 20.0 -3.8 17.9 -2.2 - - - - -Exchange Rate (MXN per USD, eop) 13.1 12.4 14.0 12.9 13.0 12.9 12.9 13.0 13.1 13.2Exchange Rate (MXN per USD, aop) 13.5 12.6 12.4 13.2 12.8 13.1 12.9 13.0 13.1 13.1External Sector Current Account Balance (% of GDP) -0.9 -0.3 -1.1 -1.2 -1.8 -1.9 -2.0 -2.0 -2.0 -1.9Current Account Balance (USD bn) -8.1 -3.6 -12.3 -14.8 -22.3 -25.8 -29.8 -31.6 -33.0 -33.5Trade Balance (USD bn) -4.7 -3.0 -1.5 0.0 -1.0 -6.5 -7.9 -11.0 -12.9 -15.1Exports (USD bn) 230 298 349 371 380 405 437 478 524 574Imports (USD bn) 234 301 351 371 381 412 445 489 537 590Exports (annual var. in %) -21.2 29.9 17.1 6.1 2.6 6.6 7.8 9.3 9.6 9.7Imports (annual var. in %) -24.0 28.6 16.4 5.7 2.8 8.1 8.1 9.7 9.8 9.9Remittances (USD bn) 21.3 21.3 22.8 22.4 21.6 22.3 23.4 24.4 26.0 28.5International Reserves (USD bn) 91 114 143 164 177 190 202 214 226 232International Reserves (months of imports) 4.6 4.5 4.9 5.3 5.6 5.5 5.4 5.3 5.1 4.7External Debt (USD bn) 166 198 211 227 259 252 270 298 317 331External Debt (% of GDP) 18.5 18.8 18.1 19.2 20.5 18.8 18.6 19.2 19.1 18.6 Quarterly Data Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15Economic Growth (GDP, annual var. in %) 1.4 0.7 2.2 2.8 3.4 3.9 3.8 3.8 3.7 3.7Economic Growth (GDP, qoq s.a. var. in %) 1.0 0.2 - - - - - - - -Private Consumption (annual var. in %) 2.9 1.5 2.2 2.8 3.7 4.2 4.0 4.0 3.8 3.7Fixed Investment (annual var. in %) -3.7 -3.0 2.1 3.2 5.4 5.8 6.2 5.5 5.6 5.1Industrial Production (annual var. in %) -0.5 -0.4 2.4 2.8 3.5 3.8 3.6 3.4 3.6 3.4Retail Sales (annual var. in %) -1.6 1.1 1.2 2.6 3.4 3.3 3.5 3.1 3.0 3.0Unemployment (% of active population, aop) 5.2 4.6 4.7 4.7 4.8 4.6 4.6 4.6 4.7 4.5Inflation (CPI, annual var. in %, eop) 3.4 4.0 3.8 3.9 4.1 3.9 3.6 3.6 3.6 3.5Banxico Target Rate (%, eop) 3.75 3.50 3.50 3.50 3.50 3.59 3.71 3.89 4.08 4.17TIIE 28 Days Rate (%, eop) 4.10 3.79 3.80 3.93 3.94 3.95 4.08 4.24 4.39 4.42Exchange Rate (MXN per USD, eop) 13.1 13.0 13.1 13.0 13.0 12.9 13.0 13.0 12.9 12.9Exchange Rate (MXN per USD, aop) 12.9 13.0 13.2 13.1 13.0 13.0 13.0 13.0 12.9 12.9Current Account Balance (% of GDP) -1.8 -1.4 -1.5 -1.1 -1.4 -1.2 -1.6 -1.0 -1.1 -1.6Current Account Balance (USD bn) -5.6 -4.7 -4.8 -3.6 -4.7 -4.3 -5.5 -3.5 -3.9 -6.3Trade Balance (USD bn) -1.0 1.9 -2.3 -1.4 -1.7 -1.5 -2.9 -1.9 -2.1 -0.5Exports (USD bn) 96.3 98.9 93.0 101.7 102.8 106.4 100.1 110.2 111.0 114.0Imports (USD bn) 97.3 97.0 95.4 103.7 105.1 108.0 103.0 112.4 113.2 114.7 Monthly Data Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14Economic Activity (IGAE, annual var. in %) -0.4 2.1 1.1 1.1 1.4 0.0 1.1 0.8 - -Industrial Production (annual var. in %) -2.1 0.3 -0.4 -1.4 0.3 -1.0 -0.3 0.8 0.7 -Retail Sales (annual var. in %) -1.9 1.3 -2.2 -4.0 -1.1 1.9 2.2 -0.3 - -Unemployment (% of active population) 5.0 5.1 5.2 5.3 5.0 4.5 4.3 5.1 4.7 -Consumer Conf. Index (100-point threshold) 93.3 98.0 97.4 94.1 91.2 88.7 89.7 84.5 84.5 88.8IMEF Manufacturing Index (50-pt threshold) 46.9 48.9 49.5 50.5 48.5 50.5 50.6 50.4 50.4 52.7Inflation (CPI, mom variation in %) -0.06 -0.03 0.28 0.38 0.48 0.93 0.57 0.89 0.25 0.27Inflation (CPI, annual var. in %) 4.1 3.5 3.5 3.4 3.4 3.6 4.0 4.5 4.2 3.8Exchange Rate (MXN per USD, eop) 13.0 12.7 13.4 13.1 13.0 13.1 13.0 13.4 13.2 13.1Exports (annual var. in %) 2.5 6.3 3.2 7.2 3.4 0.8 6.3 -1.0 4.7 -Remittances (annual var. in %) -7.2 -1.2 1.0 8.1 4.9 -0.1 4.7 8.8 5.7 -



April 2014

0%

20%

40%

60%

< 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 > 5.0


1 | Real GDP | 2000-2018 | var. in %




Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Institute of Statistics and Geography (INEGI, Instituto Nacional de Estadistica y Geografia). Forecasts based on LatinFocus Consensus Forecast.1 GDP, real annual variation in %. 2 Quarterly GDP (not seasonally adjusted), year-on-year variation in %.3 GDP, evolution of 2014 forecasts during the last 18 months.4 GDP, evolution of 2015 forecasts during the last 18 months.5 GDP, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval in


Individual Forecasts 2014 2015Banamex-Citigroup 3.3 4.0Banco Bradesco 3.2 3.5Barclays Capital 3.0 3.8BBVA Bancomer 3.4 3.0BofA Merrill Lynch 3.5 4.0Capital Economics 3.7 4.3CEESP 3.3 3.9CIDE 3.4 3.8Credit Suisse 2.8 4.5Deutsche Bank 3.0 3.7EIU 3.0 4.0GBM Securities 3.0 3.5Goldman Sachs 3.3 3.8HSBC 3.7 3.8IMEF 3.0 3.9ING 2.3 3.6INVEX 2.9 3.8Itaú BBA 3.0 3.8Jonathan Heath & Asso. 3.0 4.2JPMorgan 3.1 3.8Monex 3.0 4.6Nomura 3.2 4.0Oxford Economics 3.5 3.8Prognosis 3.2 4.0Santander 3.0 4.0Scotiabank 2.7 3.7UBS 2.8 3.7Vector Casa de Bolsa 2.4 3.5Ve Por Más 2.9 3.9SummaryMinimum 2.3 3.0Maximum 3.7 4.6Median 3.0 3.8Consensus 3.1 3.9History30 days ago 3.2 3.960 days ago 3.4 3.990 days ago 3.4 3.9Additional ForecastsCentral Bank (Feb. 2014) 3.0 - 4.0 3.2 - 4.2IMF (Apr. 2014) 3.0 3.5OECD (Nov. 2013) 3.8 4.2

-10

-5

0

5

10

2000 2005 2010 2015

MexicoLatin AmericaWorld

0

2

4

6

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

MexicoLatin AmericaWorld

2

3

4

5



2

3

4

5

6






April 2014



4

5

6

7

8


2014 2015


-10

0

10

20

2000 2005 2010 2015

MexicoLatin America


3.0

3.5

4.0

4.5

5.0


2014 2015


-10

-5

0

5

10

2000 2005 2010 2015

MexicoLatin America


Individual Forecasts 2014 2015 2014 2015Banamex-Citigroup 3.4 4.1 4.9 7.0Banco Bradesco - - - -Barclays Capital 2.5 3.5 1.8 5.8BBVA Bancomer 3.7 3.5 7.3 5.8BofA Merrill Lynch 1.8 3.6 4.2 5.0Capital Economics 4.0 4.0 - -CEESP 3.5 4.0 3.4 5.1CIDE 3.1 4.6 4.4 6.0Credit Suisse 2.5 4.3 4.5 7.0Deutsche Bank 4.0 4.7 - -EIU 3.3 3.9 6.3 8.1GBM Securities 3.5 4.3 4.1 4.2Goldman Sachs - - - -HSBC 3.9 4.5 7.1 5.7IMEF - - - -ING - - - -INVEX 2.9 3.4 4.7 5.0Itaú BBA - - - -Jonathan Heath & Asso. 2.9 4.3 7.8 9.7JPMorgan - - - -Monex 3.9 - 7.8 -Nomura 2.6 4.1 3.5 4.5Oxford Economics 3.2 4.0 4.4 4.8Prognosis - - - -Santander 2.7 3.2 6.1 7.0Scotiabank 2.9 4.0 2.8 5.6UBS - - - -Vector Casa de Bolsa 2.0 3.6 -1.5 2.5Ve Por Más 2.9 3.8 2.9 5.9SummaryMinimum 1.8 3.2 -1.5 2.5Maximum 4.0 4.7 7.8 9.7Median 3.1 4.0 4.4 5.8Consensus 3.1 4.0 4.5 5.8History30 days ago 3.4 4.0 4.9 5.860 days ago 3.7 4.0 5.3 6.290 days ago 3.7 3.5 5.1 5.9

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Institute of Statistics and Geography (INEGI, Instituto Nacional de Estadistica y Geografia). Forecasts based on LatinFocus Consensus Forecast.6 Private consumption, annual variation in %. 7 Private consumption, evolution of 2014 and 2015 forecasts during the last 18 months.8 Gross fixed investment, annual variation in %.9 Gross fixed investment, evolution of 2014 and 2015 forecasts during the last 18 months.




April 2014



Individual Forecasts 2014 2015 2014 2015 2014 2015Banamex-Citigroup 3.0 3.8 4.8 4.6 -3.5 -2.5Banco Bradesco - - - - - -Barclays Capital 2.4 4.6 4.5 4.2 -3.5 -3.1BBVA Bancomer - - 5.0 5.3 - -BofA Merrill Lynch - - 4.5 4.3 -3.5 -3.0Capital Economics 4.0 5.0 4.6 4.4 - -CEESP 3.6 3.8 4.7 4.6 -3.5 -3.3CIDE 3.5 3.9 4.7 4.5 -3.4 -2.0Credit Suisse - - 4.6 4.2 -2.6 -3.5Deutsche Bank 2.7 3.3 - - -4.0 -3.6EIU 3.8 4.0 4.7 4.6 -3.7 -3.2GBM Securities 2.2 2.7 5.1 4.9 -3.9 -2.5Goldman Sachs - - - - -3.5 -3.0HSBC 3.3 3.3 4.8 4.8 -3.5 -3.0IMEF - - - - -3.5 -3.0ING - - - - - -INVEX 2.8 4.9 4.8 4.7 -3.5 -3.0Itaú BBA - - 5.0 5.0 -3.4 -3.0Jonathan Heath & Asso. 2.8 4.0 4.6 4.2 -3.5 -3.0JPMorgan - - - - -3.5 -3.0Monex 4.4 - - - - -Nomura - - - - -4.1 -3.0Oxford Economics 3.4 5.4 4.7 4.5 -2.4 -2.5Prognosis - - 4.8 4.6 -3.7 -3.7Santander 2.1 4.2 4.9 4.8 -3.5 -3.0Scotiabank 2.3 3.3 4.4 4.1 -3.4 -3.0UBS 3.1 3.2 4.6 4.5 -4.0 -4.1Vector Casa de Bolsa 1.5 3.0 4.8 4.6 -4.6 -5.1Ve Por Más 2.7 4.1 4.7 4.6 -3.5 -SummaryMinimum 1.5 2.7 4.4 4.1 -4.6 -5.1Maximum 4.4 5.4 5.1 5.3 -2.4 -2.0Median 2.9 3.9 4.7 4.6 -3.5 -3.0Consensus 3.0 3.9 4.7 4.6 -3.6 -3.1History30 days ago 2.9 3.7 4.7 4.6 -3.5 -3.160 days ago 3.3 3.8 4.7 4.6 -3.5 -3.190 days ago 3.3 3.8 4.7 4.6 -3.4 -2.8

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Institute of Statistics and Geography (INEGI, Instituto Nacional de Estadistica y Geografia) and the Central Bank (Banxico, Banco de Mexico). See below for details. Forecasts based on LatinFocus Consensus Forecast.10 Industrial production, annual variation in %. Source: INEGI.11 Industrial production, evolution of 2014 and 2015 forecasts during the last 18 months.12 Unemployment, % of active population. Source: INEGI.13 Balance of non-financial public sector as % of GDP. Source: Banxico.



-4

-3

-2

-1

0

1

2000 2005 2010 2015

MexicoLatin America


2

4

6

8

10

2000 2005 2010 2015

MexicoLatin America


2.5

3.0

3.5

4.0

4.5


2014 2015


-10

-5

0

5

10

2000 2005 2010 2015

MexicoLatin America



April 2014

0%

20%

40%

60%

80%

< 2.0 2.5 3.0 3.5 4.0 4.5 5.0 5.5 > 5.5


14 | Inflation | 2000 - 2018 | in %


15 | Inflation | Q1 11-Q4 15 | in %


Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the National Institute of Statistics and Geography (INEGI, Instituto Nacional de Estadistica y Geografia). Forecasts are based on LatinFocus Consensus Forecast.14 Inflation, annual variation of consumer price index (CPI) in % (eop). 15 Quarterly inflation, annual variation of consumer price index (CPI) in % (eop).16 Inflation, evolution of 2014 forecasts during the last 18 months.17 Inflation, evolution of 2015 forecasts during the last 18 months.18 Inflation, panelist distribution of 2014 forecasts. Concentration of panelists in forecast interval


Individual Forecasts 2014 2015Banamex-Citigroup 4.0 3.6Banco Bradesco - -Barclays Capital 3.8 3.7BBVA Bancomer 3.8 3.5BofA Merrill Lynch 4.0 3.6Capital Economics 4.0 3.3CEESP 3.9 3.6CIDE 4.0 3.4Credit Suisse 4.0 3.8Deutsche Bank 4.0 3.7EIU 3.4 3.4GBM Securities 3.6 3.0Goldman Sachs 3.9 3.2HSBC 3.9 3.2IMEF 3.9 3.6ING 4.1 3.5INVEX 4.0 3.1Itaú BBA 3.7 3.2Jonathan Heath & Asso. 3.6 3.2JPMorgan 4.1 3.1Monex 4.1 3.4Nomura 4.0 3.2Oxford Economics 3.8 3.5Prognosis 3.9 3.5Santander 3.9 3.6Scotiabank 4.2 4.0UBS 4.0 3.5Vector Casa de Bolsa 4.1 3.8Ve Por Más 3.8 3.8SummaryMinimum 3.4 3.0Maximum 4.2 4.0Median 3.9 3.5Consensus 3.9 3.5History30 days ago 3.9 3.560 days ago 3.9 3.490 days ago 3.8 3.4Additional ForecastsCentral Bank (Feb. 2014) <4.0 ~3.0IMF (Apr. 2014) 4.0 3.7OECD (Nov. 2013) 3.0 3.1



2

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12

2000 2005 2010 2015

MexicoLatin America

2

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4

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12

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

MexicoLatin America



April 2014

0%

20%

40%

60%

80%

100%

< 2.75 3.00 3.25 3.50 3.75 4.00 4.25 4.50 > 4.50


19 | Interest Rate | 2000 - 2018 | in %




Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the Central Bank (Banxico, Banco de Mexico). Forecasts are based on LatinFocus Consensus Forecast.19 Interest rate, Central Bank policy rate in % (eop).20 Quarterly interest rate, Central Bank policy rate in % (eop).21 Interest rate, evolution of 2014 forecasts during the last 18 months.22 Interest rate, evolution of 2015 forecasts during the last 18 months.23 Interest rate, panelist distribution of 2014 forecasts. Concentration of panelists in forecast


Individual Forecasts 2014 2015Banamex-Citigroup 3.50 4.75Banco Bradesco - -Barclays Capital 3.50 4.50BBVA Bancomer 3.50 3.75BofA Merrill Lynch 3.50 4.00Capital Economics 4.50 5.00CEESP 3.50 -CIDE 3.50 4.50Credit Suisse 3.50 3.50Deutsche Bank 3.50 -EIU - -GBM Securities 3.75 4.25Goldman Sachs 4.00 5.00HSBC 3.50 4.00IMEF 3.50 4.00ING 3.50 4.00INVEX 3.50 4.00Itaú BBA 3.50 4.50Jonathan Heath & Asso. 3.50 4.00JPMorgan 3.50 -Monex 3.50 3.50Nomura 3.50 3.50Oxford Economics - -Prognosis 3.50 4.00Santander 3.50 4.50Scotiabank 4.00 5.00UBS - -Vector Casa de Bolsa 3.50 3.50Ve Por Más 3.50 4.00SummaryMinimum 3.50 3.50Maximum 4.50 5.00Median 3.50 4.00Consensus 3.59 4.17History30 days ago 3.60 4.2760 days ago 3.59 4.3290 days ago 3.59 4.32



3

4

5

6

7



0

5

10

15

20

2000 2005 2010 2015

MexicoLatin America

3

4

5

6

7



2

4

6

8

10

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

MexicoLatin America



April 2014

0%

20%

40%

60%

< 11.00 11.50 12.00 12.50 13.00 13.50 14.00 14.50 > 14.50


24 | Exchange Rate | MXN per USD

26 | MXN per USD 2014 | evol. of fcst

25 | Exchange Rate | MXN per USD

27 | MXN per USD 2015 | evol. of fcst

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from Thomson Reuters. Forecasts based on LatinFocus Consensus Forecast.24 Exchange rate, MXN per USD (eop).25 Quarterly exchange rate, MXN per USD (eop).26 Exchange rate, evolution of 2014 forecast during the last 18 months.27 Exchange rate, evolution of 2015 forecast during the last 18 months.28 Exchange rate, panelist distribution of 2014 forecasts. Concentration of panelists in forecast


Individual Forecasts 2014 2015Banamex-Citigroup 13.10 12.80Banco Bradesco 13.50 13.63Barclays Capital 12.95 13.14BBVA Bancomer 13.29 12.99BofA Merrill Lynch 12.90 12.50Capital Economics - -CEESP 13.12 13.00CIDE 13.29 13.56Credit Suisse 13.00 12.50Deutsche Bank 12.80 12.80EIU 12.81 12.83GBM Securities 12.30 12.36Goldman Sachs 13.00 13.52HSBC 12.60 12.60IMEF 13.00 13.00ING 13.00 12.70INVEX 12.50 12.00Itaú BBA 13.20 13.20Jonathan Heath & Asso. 13.28 13.44JPMorgan 12.40 -Monex 12.90 -Nomura 12.50 12.50Oxford Economics 13.00 13.03Prognosis 12.90 13.00Santander 12.60 12.54Scotiabank 13.38 13.50UBS 12.90 12.50Vector Casa de Bolsa 13.25 13.55Ve Por Más 12.74 12.56SummaryMinimum 12.30 12.00Maximum 13.50 13.63Median 12.98 12.91Consensus 12.94 12.91History30 days ago 12.81 12.8660 days ago 12.73 12.7790 days ago 12.63 12.57

28 | MXN per USD 2014 | Panelist Distribution

Exchange Rate | MXN per USD

11

12

13

14



9

10

11

12

13

14

2000 2005 2010 2015

11

12

13

14



11

12

13

14

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15



April 2014


-12

-9

-6

-3


2014 2015


-200

0

200

400

600

2000 2005 2010 2015



-3

-2

-1

0

1

2

2000 2005 2010 2015

MexicoLatin America


-2.5

-2.0

-1.5

-1.0


2014 2015



% of GDP USD bnIndividual Forecasts 2014 2015 2014 2015Banamex-Citigroup -2.1 -1.8 -4.6 -3.2Banco Bradesco - - - -Barclays Capital -2.6 -1.5 -11.5 8.1BBVA Bancomer -1.9 -2.0 -3.8 -5.5BofA Merrill Lynch -2.0 -2.5 0.1 -1.1Capital Economics -1.5 -1.5 - -CEESP -1.2 -1.3 -10.7 -12.3CIDE -1.9 -2.4 -7.1 -11.4Credit Suisse -2.3 -3.0 - -Deutsche Bank -2.1 -2.2 -7.4 -12.8EIU -1.6 -1.6 -0.9 -1.8GBM Securities -2.0 -2.0 -3.6 -4.9Goldman Sachs -1.8 -1.7 -0.7 0.5HSBC -1.6 -1.6 -0.8 -5.9IMEF -1.8 -1.9 - -ING - - - -INVEX -2.0 -1.8 -2.3 -5.1Itaú BBA -2.2 -2.4 -8.0 -10.0Jonathan Heath & Asso. -2.1 -2.4 -6.0 -8.5JPMorgan -1.4 -1.6 -7.2 -10.2Monex - - - -Nomura -1.7 -1.7 -5.2 -5.7Oxford Economics -1.9 -2.2 -23.9 -27.6Prognosis -1.8 -2.0 -5.5 -10.1Santander -1.9 -1.9 -5.7 -6.0Scotiabank -1.8 -1.9 -11.0 -15.1UBS -2.2 -2.8 -6.0 -4.8Vector Casa de Bolsa -2.8 -3.6 -12.0 -20.0Ve Por Más - - - -SummaryMinimum -2.8 -3.6 -23.9 -27.6Maximum -1.2 -1.3 0.1 8.1Median -1.9 -1.9 -5.8 -5.9Consensus -1.9 -2.0 -6.5 -7.9History30 days ago -1.8 -1.9 -6.7 -7.660 days ago -1.7 -1.8 -6.7 -8.490 days ago -1.7 -1.7 -9.9 -7.5

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (Banxico, Banco de Mexico). Forecasts based on LatinFocus Consensus Forecast.29 Current account balance, as % of GDP. 30 Current account balance, evolution of 2014 and 2015 forecasts during the last 18 months.31 Trade balance, exports and imports, in USD. 32 Trade balance, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014



Individual Forecasts 2014 2015 2014 2015Banamex-Citigroup 413 466 418 469Banco Bradesco - - - -Barclays Capital 405 447 418 454BBVA Bancomer - - - -BofA Merrill Lynch 411 445 411 446Capital Economics - - - -CEESP 409 460 420 473CIDE 410 446 417 457Credit Suisse - - - -Deutsche Bank 388 403 396 416EIU 408 444 409 446GBM Securities 390 402 394 407Goldman Sachs 402 427 403 427HSBC 416 461 416 467IMEF - - - -ING - - - -INVEX 389 408 392 413Itaú BBA - - - -Jonathan Heath & Asso. 406 436 412 444JPMorgan 404 447 412 458Monex - - - -Nomura - - - -Oxford Economics 417 468 441 495Prognosis 407 439 410 447Santander 418 461 424 467Scotiabank 396 426 407 441UBS 403 377 409 382Vector Casa de Bolsa 408 435 420 455Ve Por Más - - - -SummaryMinimum 388 377 392 382Maximum 418 468 441 495Median 407 444 412 447Consensus 405 437 412 445History30 days ago 406 440 413 44760 days ago 408 438 415 44690 days ago 409 445 420 452

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (Banxico, Banco de Mexico). Forecasts based on LatinFocus Consensus Forecast.33 Exports, annual variation in %. 34 Exports, evolution of 2014 and 2015 forecasts during the last 18 months.35 Imports, annual variation in %. 36 Imports, evolution of 2014 and 2015 forecasts during the last 18 months.

400

420

440

460

480

500


2014 2015


-40

-20

0

20

40

2000 2005 2010 2015

MexicoLatin America


-40

-20

0

20

40

2000 2005 2010 2015

MexicoLatin America


400

420

440

460

480

500


2014 2015




April 2014


220

240

260

280


2014 2015


10

20

30

40

2000 2005 2010 2015

Mexico

Latin America


2

4

6

8

10

2000 2005 2010 2015

MexicoLatin America


180

190

200

210


2014 2015



USD bn USD bnIndividual Forecasts 2014 2015 2014 2015Banamex-Citigroup - - 258 277Banco Bradesco - - - -Barclays Capital 191 197 - -BBVA Bancomer - - - -BofA Merrill Lynch 185 195 242 273Capital Economics - - - -CEESP 182 189 - -CIDE - - - -Credit Suisse 195 210 250 260Deutsche Bank 205 225 289 335EIU - - - -GBM Securities 189 199 - -Goldman Sachs 185 200 - -HSBC 194 215 - -IMEF - - - -ING - - - -INVEX - - - -Itaú BBA 190 205 - -Jonathan Heath & Asso. 189 196 220 224JPMorgan 187 194 - -Monex - - - -Nomura - - - -Oxford Economics - - - -Prognosis 192 200 - -Santander 185 190 259 271Scotiabank 185 208 245 254UBS - - - -Vector Casa de Bolsa 200 205 - -Ve Por Más - - - -SummaryMinimum 182 189 220 224Maximum 205 225 289 335Median 189 200 250 271Consensus 190 202 252 270History30 days ago 189 201 252 27060 days ago 192 204 255 27190 days ago 190 202 252 270

Notes and sources

Long-term chart period from 2000 to 2018 unless otherwise stated. All external sector data are from from the Central Bank (Banxico, Banco de Mexico). Forecasts based on LatinFocus Consensus Forecast.38 International reserves, months of imports. 39 International reserves, evolution of 2014 and 2015 forecasts during the last 18 months.40 External debt as % of GDP. 41 External debt, evolution of 2014 and 2015 forecasts during the last 18 months.



April 2014

Mexico in the Region


Fact Sheet

Mexico22.2%

Brazil38.9%

Argentina8.2%

Venezuela6.7%

Colombia6.7%

Other17.3%

Mexico20.1%

Brazil34.0%Colombia

8.0%

Argentina7.1%

Peru5.3%

Other25.6%

U.S.A.49.9%

EU-2710.7%

Other Asia ex-Japan

8.2%

China15.4%

Other15.8%

U.S.A.77.6%

EU-275.8%

LatAm7.5%

Other9.0%

Other6.0%


Mineral Fuels8.3%

Food6.9%

Other4.1%


Mineral Fuels14.6%

Food6.5%

Trade Structure



Economic Structure


Exports

Exports

Imports

Imports

-20

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

0

20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



• Large domestic market

• Commitment to sound fiscal policy

• NAFTA membership shields the economy from emerging markets crises

• Dependence on the U.S.economy• Financial sector still relatively weak• Instability created by drug-related violence

Energy (2010)Primary Energy Production (trillion Btu): 8,778Primary Energy Consumption (trillion Btu): 7,284Electricity Generation (billion kW-h): 257Electricity Consumption (billion kW-h): 212Oil Supply (thousand bpd): 2,979Oil Consumption (thousand bpd): 2,080CO2 Emmissions (million metric tons): 432

Agency Rating OutlookMoody’s: A3 StableS&P: BBB+ StableFitch Ratings: BBB+ Stable


Transportation (2012) Airports: 1,744Railways (km): 17,166Roadways (km): 366,095Waterways (km): 2,900Chief Ports: Veracruz, Lazaro Cardenas

Official name: United Mexican StatesCapital: Mexico City (19.3m)Other cities: Guadalajara (4.1m)

Monterrey (3.7m)Area (km2): 1,972,550Population (million, 2013 est.): 118Population density (per km2, 2012 est.): 59.9Population growth rate (%, 2012 est.): 0.72Life expectancy (years, 2012 est.): 75.7Illiteracy rate (%, 2005): 13.9Language: Spanish and IndigenousMeasures: Metric systemTime: GMT-6 to GMT-8

President: Enrique Peña NietoLast elections: 1 July 2012Next elections: July 2018Central Bank President: Agustin Carstens Carstens

FOCUSECONOMICS Peru


April 2014

Peru

REAL SECTOR | Economic activity decelerates further in JanuaryIn January, economic activity expanded 4.2% over the same month last year, which marked a deceleration compared to the 5.0% expansion tallied in December. According to the statistical institute, fishing was the only category among the 13 that make up the index in which economic activity contracted. Although the category does not account for substantial weight in the index overall, the large contraction was enough to drag the result down slightly.

A month-on-month comparison corroborates the slowdown suggested by the annual data. Economic activity contracted a seasonally-adjusted 1.1% in January, which contrasted the 0.2% expansion registered in December and marked the biggest drop since April 2012.

As a consequence of the annual deceleration, the trend continues to point downward with annual average growth in economic activity edging down from 5.0% in December to 4.8% in January, and now sits at its lowest level since May 2010.

In its December 2013 inflation report, the Central Bank projected that the economy will expand 6.0% in 2014. For 2015, the Bank sees the economy expanding 6.5%. LatinFocus Consensus Forecast panelists expect GDP to expand 5.4% this year, which is unchanged from last month’s projection. For 2015, the panel expects the economy to grow 5.6%.

In January, economic activity expanded 4.2% over the same month of last year. The print marked a deceleration from the 5.0% expansion tallied in December, thereby underlining the overall downward trend in activity. In February, the trade balance tallied a modest USD 58 million surplus, contrasting the record-high USD 679 deficit registered in January. More recent data suggest that the economy may continue to lose steam going forward. In March, business sentiment and consumer confidence both moderated over the previous month.

LatinFocus panelists expect the economy to expand 5.4% this year, which is unchanged over the previous month’s projection. For 2015, panelists see the economy growing 5.6%.

Annual inflation decreased from 3.8% in February to 3.4% in March. The Central Bank decided to keep the reference rate at 4.00% at its 10 April monetary policy meeting. Panelists see year-end inflation at 2.7% in 2014 and at 2.6% in 2015.

Outlook stable


Peru

2010-12 2013-15 2016-18Population (million): 30.0 31.4 32.9GDP (USD bn): 177 220 278GDP per capita (USD): 5,883 6,996 8,448GDP growth (%): 7.3 5.4 5.8Fiscal Balance (% of GDP): 1.2 0.3 0.2Public Debt (% of GDP): 21.4 18.5 18.0Inflation (%): 2.8 2.7 2.4Current Account (% of GDP): -2.5 -4.6 -3.5External Debt (% of GDP): 28.4 26.5 22.3

Carl KellyEconomist


Note: Year-on-year changes of economic activity and annual average growth rate in %.Source: Peru National Statistical Institute (INEI) and FocusEconomics calculations.

2.0

4.0

6.0

8.0

Jan-12 Jul-12 Jan-13 Jul-13 Jan-14

Year-on-year

Annual average

%

FOCUSECONOMICS Peru


April 2014

OUTLOOK | Consumer confidence edges down in March on weakening employment prospectsIn March, the consumer confidence indicator published by APOYO Consultoria fell slightly to 51 points from February’s 52 points. While the result indicates that consumers are still optimistic, the index has been hovering just above the 50-point threshold that separates optimism from pessimism.

The small drop in confidence over the previous month was driven primarily by a moderation in consumers’ outlook regarding the job market. According to APOYO, the persistent drop in employment is dragging on private consumption. APOYO explained that, “the average consumer does not perceive important changes in conditions compared to a year ago and does not foresee significant improvements in the near future.”

The overall drop in confidence regarding the economy was shared across socioeconomic levels. However, individuals in the low-income bracket expressed worsening prospects for their families’ economic situation, whereas those in the high-income bracket were more confident in this regard.

FocusEconomics Consensus Forecast panelists expect total consumption to expand 5.3% in 2014, which is unchanged from last month’s estimate. For 2015, panelists expect total consumption to also grow 5.3%.

OUTLOOK | Businesses confidence falls in March but remains positiveIn March, businesses confidence reached 54 points, which was down from the 10-month high of 60 points registered in February, according to the Central Bank’s business confidence indicator. Business confidence has been in optimistic territory—above the 50-point threshold that separates optimism from pessimism—since July of 2011, except for a one-off dip into negative territory in August of last year.

Expectations for demand conditions and hiring in the next three months moderated in March. In addition, purchase orders and sales levels were down slightly compared to the previous month. That said, businesses maintained their projections regarding access to credit and were a bit more positive regarding their inventory situation with respect to the previous month.

FocusEconomics Consensus Forecast panelists expect fixed investment to grow 6.8% this year, which is unchanged from last month’s forecast. For 2015, panel participants see investment growing 7.5%.

MONETARY SECTOR | Inflation recedes in MarchConsumer prices for Metropolitan Lima increased 0.52% over the previous month in March, which was down slightly from the 0.60% rise registered in February. The print was broadly in line with the 0.53% increase the market had expected. The increase was broad-based as all eight components of the index increased in March. The largest expansions were recorded in education and culture as well as in house rentals, fuels and electricity.

Annual headline inflation decreased from 3.8% in February to 3.4% in March. However, inflation remains above the upper limit of the Central Bank’s target of 2.0% plus/minus 1.0 percentage points.

Business Confidence Index

Note: Business Confidence Index (Indice de Confianza Empresarial).Values above 50 indicate an optimistic assesment in business climate while values below 50 indicate a pessimistic assesment.Source: Peru Central Bank (BCRP).

40

50

60

70


Consumer Confidence Index

Note: Consumer Confidence Index (INDICCA). Values above 50 indicate an optimistic assesment in consumer sentiment while values below 50 indicate a pessimistic assesment.Source: APOYO Consultoria.

45

50

55

60


FOCUSECONOMICS Peru


April 2014

In its December quarterly inflation report, the Central Bank indicated that it expects inflation of around 2.0% for both 2014 and 2015. LatinFocus Consensus Forecast panelists expect inflation to end 2014 at 2.7%, which is unchanged from last month’s projection. For 2015, the panel expects inflation of 2.6%.

MONETARY SECTOR | Central Bank leaves rate unchanged in AprilThe Central Bank decided to maintain the reference rate at 4.00% at its 10 April monetary policy meeting, which was in line with market expectations. The reference rate has remained at this level since November 2013. The decision to keep the rate unchanged comes amid tepid economic growth and moderating inflation.

As in previous meetings, the Central Bank stated that the Peruvian economy continues to perform below potential. Despite dynamic economic activity during the first half of this year, growth has been lower than expected. Moreover, it added that recent indicators point to a mixed picture of the recovery at a global level, which will likely put a damper on the Peruvian export sector. The Bank expects that inflation will remain just above the upper band of its target range of 1.0%–3.0% in the coming months due to the delayed impact of recent supply shocks. In fact, annual inflation decreased from 3.8% in February to 3.4% in March. However, monetary authorities see inflation converging to 2.0% in the medium- and long-term.

In a separate decision, the Bank lowered the average reserve requirement ratio for local currency deposits from 12.5% to 12.0%. The decision, which followed similar moves in the previous months, is aimed at supporting the expansion of credit in local currency as part of the Bank’s objective to progressively reduce the degree of dollarization in Peruvian financial markets and to boost economic activity amid declining copper exports. The next monetary policy meeting will be held on 8 May.

The majority of the panelists polled by FocusEconomics expect monetary authorities to maintain the reference rate unchanged at 4.00% this year. For 2015, the panel expects an average monetary policy rate of 4.37% at the end of the year.

EXTERNAL SECTOR | Trade balance rebounds to modest surplus in FebruaryIn February, the trade balance registered a surplus of USD 58 million, which was greater than the USD 20 million surplus observed in the same month last year. February’s result contrasted the all-time record deficit of USD 679 million observed in January. In the 12 months up to February, the trade balance posted a USD 677 million deficit.

Exports contracted 5.8% over the same month of the last year (January: -14.4% year-on-year). Imports contracted 7.1% in February, which followed January’s 3.9% drop.

A downward trend in the trade balance has been registered in the last two years, as low international prices for traditional Peruvian exports such as copper and natural gas more than offset the higher volumes exported. Similarly, the increase in import volumes has also been negatively affecting the trade balance, despite lower international prices.


Note: Central Bank Reference Rate in %.Source: Peru Central Bank (BCRP).

0.0

2.0

4.0

6.0

8.0


%


Note: Month-on-month and year-on-year changes of consumer price index in %.Source: Peru National Statistical Institute (INEI).

2.0

3.0

4.0

5.0

-0.5

0.0

0.5

1.0




%%

Merchandise Trade

Note: 12-month sum of trade balance in USD billion and annual variation of the12-month sum of exports and imports in %.Source: Peru Central Bank (BCRP).

-15

0

15

30

45

-5

0

5

10

15



%

FOCUSECONOMICS Peru


April 2014

The Central Bank expects exports to grow 3.2% in 2014. For 2015, the Bank sees overseas sales expanding a healthier 12.3%. LatinFocus Consensus Forecast panelists see exports expanding 6.6% this year, which is down 0.2 percentage points from previous month’s estimate. For 2015, the panel sees overseas sales expanding 8.6%.

FOCUSECONOMICS Peru


April 2014


Annual Data 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Real Sector Population (million) 29.1 29.6 30.0 30.5 30.9 31.4 31.9 32.4 32.9 33.4GDP per capita (USD) 4,371 5,206 5,903 6,540 6,784 6,903 7,300 7,833 8,449 9,062GDP (USD bn) 127 154 177 199 210 217 233 254 278 303Economic Growth (GDP, annual var. in %) 0.9 8.8 6.9 6.3 5.0 5.4 5.6 5.7 5.8 5.9Domestic Demand (annual var. in %) -2.8 13.1 7.1 7.2 5.7 5.6 5.9 6.4 6.6 6.7Total Consumption (annual var. in %) 3.9 6.5 6.2 6.3 5.3 5.3 5.3 5.3 5.3 5.2Fixed Investment (annual var. in %) -9.2 23.2 4.8 14.8 5.9 6.8 7.5 7.8 8.0 8.2Manufacturing (annual var. in %) -6.9 14.1 5.6 1.6 1.7 4.2 5.6 5.8 6.0 6.1Commerce (annual var. in %) -0.3 9.7 8.8 6.7 5.8 5.6 5.9 6.3 6.5 6.6Unemployment (% of active population, aop) 8.4 7.9 7.7 6.8 6.0 6.3 6.3 6.3 6.1 5.9Fiscal Balance (% of GDP) -1.3 -0.3 1.9 2.1 0.8 0.1 0.1 0.2 0.2 0.4Public Debt (% of GDP) 27.1 23.3 21.2 19.8 19.2 18.7 17.8 18.7 18.0 17.4Monetary and Financial Sector Money (annual variation of M2 in %) 10.6 33.8 13.7 25.3 5.9 - - - - -Inflation (CPI, annual var. in %, eop) 0.3 2.1 4.7 2.7 2.9 2.7 2.6 2.4 2.2 2.2Inflation (CPI, annual var. in %, aop) 2.9 1.5 3.4 3.7 2.8 2.9 2.6 2.5 2.3 2.2Inflation (Core, annual variation in %, eop) 2.4 2.1 3.7 3.3 3.7 - - - - -Inflation (WPI, annual variation in %, eop) -1.8 1.8 6.3 1.8 0.4 - - - - -Monetary Policy Rate (%, eop) 1.25 3.00 4.25 4.25 4.00 4.02 4.37 4.67 4.60 4.50Stock Market (variation of IGBVL in %) 99.3 66.4 -16.7 5.9 -23.6 - - - - -Exchange Rate (PEN per USD, eop) 2.89 2.81 2.70 2.55 2.80 2.86 2.86 2.81 2.79 2.76Exchange Rate (PEN per USD, aop) 3.01 2.82 2.75 2.64 2.70 2.83 2.86 2.84 2.80 2.78External Sector Current Account Balance (% of GDP) -0.6 -2.5 -1.9 -3.3 -5.0 -4.7 -4.0 -3.7 -3.6 -3.2Current Account Balance (USD bn) -0.7 -3.8 -3.3 -6.6 -10.2 -10.2 -9.2 -9.5 -10.0 -9.6Trade Balance (USD bn) 6.0 6.7 9.3 5.1 -0.4 -0.3 1.1 1.6 2.6 3.5Exports (USD bn) 27.0 35.6 46.3 46.2 41.8 44.5 48.4 52.8 57.6 62.7Imports (USD bn) 21.0 28.8 37.0 41.1 42.2 44.8 47.3 51.2 55.0 59.2Exports (annual variation in %) -12.9 31.9 30.1 -0.1 -9.5 6.6 8.6 9.1 9.1 8.9Imports (annual variation in %) -26.1 37.1 28.3 10.9 2.7 6.2 5.6 8.1 7.4 7.7International Reserves (USD bn) 33.0 44.0 49.0 64.0 66.0 65.8 67.1 77.0 77.9 78.7International Reserves (months of imports) 18.9 18.3 15.9 18.7 18.8 17.6 17.0 18.0 17.0 16.0External Debt (USD bn) 35.0 44.0 48.0 59.0 60.0 56.5 58.2 59.0 60.5 66.1External Debt (% of GDP) 27.5 28.6 27.1 29.6 28.6 26.1 25.0 23.2 21.8 21.8 Quarterly Data Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15Economic Growth (GDP, annual var. in %) 4.5 5.1 5.0 5.2 5.5 5.7 5.8 5.7 5.7 5.7Economic Growth (GDP, qoq variation in %) 2.4 1.9 - - - - - - - -Total Consumption (annual var. in %) 5.4 4.9 5.3 5.2 5.3 5.3 5.3 5.3 5.2 5.2Fixed Investment (annual var. in %) 4.6 1.8 5.5 5.7 7.6 7.9 8.1 7.7 7.4 6.9Manufacturing (annual var. in %) 1.7 1.3 4.3 3.9 4.0 4.5 5.6 5.3 5.7 6.0Commerce (annual var. in %) 5.1 6.8 5.7 5.0 5.9 5.6 5.4 6.0 6.0 6.2Unemployment (% of active population, aop) 5.9 5.7 6.7 6.3 6.4 6.1 6.0 6.2 6.5 6.5Inflation (CPI, annual var. in %, eop) 2.8 2.9 3.4 3.0 2.5 2.7 2.5 2.6 2.5 2.6Monetary Policy Rate (%, eop) 4.25 4.00 4.00 4.00 3.97 4.02 4.00 4.00 4.09 4.37Exchange Rate (PEN per USD, eop) 2.79 2.80 2.81 2.84 2.85 2.86 2.85 2.85 2.86 2.86Exchange Rate (PEN per USD, aop) 2.79 2.78 2.81 2.83 2.85 2.86 2.85 2.85 2.86 2.86Current Account Balance (% of GDP) -5.0 -4.4 -4.7 -4.9 -4.9 -4.4 -4.0 -5.0 -4.0 -3.0Current Account Balance (USD bn) -2.5 -2.3 -2.4 -2.8 -2.7 -2.5 -2.2 -3.1 -2.4 -1.8Trade Balance (USD bn) 0.0 0.1 0.0 -0.3 -0.2 0.0 0.2 0.3 0.3 0.4Exports (USD bn) 11.1 10.4 11.0 11.0 11.3 11.6 11.4 11.6 11.9 13.5Imports (USD bn) 11.1 10.3 11.0 11.3 11.0 11.5 11.4 11.5 11.7 12.8 Monthly Data Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14Economic Activity (IMAE, annual var. in %) 4.4 4.7 4.4 4.4 5.5 5.0 5.0 4.2 - -Manufacturing (annual variation in %) 2.2 1.7 -0.4 3.9 3.2 -1.0 1.8 0.4 - -Unemployment (% of active population) 5.5 5.9 5.3 6.6 5.3 5.2 6.5 7.4 7.0 -Consumer Confid. Index (50-point threshold) 56 54 50 50 50 52 56 52 52 51Business Confid. Index (50-point threshold) 51 50 48 53 55 54 59 59 60 54Inflation (CPI, mom variation in %) 0.26 0.55 0.54 0.11 0.04 -0.22 0.17 0.32 0.60 0.52Inflation (CPI, annual variation in %) 2.8 3.2 3.3 2.8 3.0 3.0 2.9 3.1 3.8 3.4Exchange Rate (PEN per USD, eop) 2.78 2.80 2.81 2.79 2.78 2.80 2.80 2.82 2.80 2.81Exports (annual variation in %) -13.5 -15.2 7.0 -11.0 -9.3 -15.4 -9.4 -14.4 -5.8 -

FOCUSECONOMICS Peru


April 2014


1 | Real GDP | 2000 - 2018 | var. in %







8 | Investment | evolution of forecasts

Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (INEI, Instituto Nacional de Estadistica e Informatica del Peru) and the Central Bank (BCRP, Banco Central de Reserva del Peru). See below for details. Forecasts based on LatinFocus Consensus Forecast. 1 GDP, annual variation in %. Source: INEI.2 Quarterly GDP (not seasonally adjusted), year-on-year variation in %.

Source: INEI.3 GDP, evolution of 2014 forecasts during the last 18 months.4 GDP, evolution of 2015 forecasts during the last 18 months.5 Total consumption, annual variation in %. Source: INEI.6 Gross fixed investment, annual variation in %. Source: INEI.7 Total consumption, change in 2014 and 2015 forecasts during the last

18 months.8 Gross fixed investment, change in 2014 and 2015 forecasts during the

last 18 months.9 Manufacturing, annual variation in %. Source: INEI.10 Unemployment, % of active population. Source: INEI.11 Balance of non-financial public sector as % of GDP. Source: BCRP.12 Manufacturing, evolution of 2014 and 2015 forecasts during the last 18

months.13 Unemployment, evolution of 2014 and 2015 forecasts during the last 18

months.14 Balance of non-financial public sector as % of GDP, evolution of 2014

and 2015 forecasts during the last 18 months.

Individual Forecasts 2014 2015APOYO Consultoría 5.0 5.1Banco Bradesco 5.2 5.0Banco de Crédito del Perú 5.5 6.3Barclays Capital 5.1 5.7BBVA Banco Continental 5.6 5.9BofA Merrill Lynch 4.2 3.9BTG Pactual 5.3 5.8Capital Economics 5.0 4.8Citigroup Global Mkts 5.7 6.2Credicorp Capital 5.5 6.3Credit Suisse 5.5 5.8Deutsche Bank 6.0 6.5EIU 5.6 5.9Goldman Sachs 5.1 5.4HSBC 5.5 6.1IEDEP - CCL 5.7 5.9IPE 6.0 6.1Itaú BBA 5.6 5.6JPMorgan 5.0 5.5Macroconsult 6.1 -Rimac Seguros 5.9 5.2Santander 5.5 5.5Scotiabank 5.5 5.8UBS 5.2 5.2SummaryMinimum 4.2 3.9Maximum 6.1 6.5Median 5.5 5.8Consensus 5.4 5.6History30 days ago 5.4 5.760 days ago 5.4 5.690 days ago 5.5 5.5Additional ForecastsCentral Bank (Dec. 2013) 6.0 6.5IMF (Apr. 2014) 5.5 5.8World Bank (Jan. 2014) 5.5 5.9

-5

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10

2000 2005 2010 2015

PeruLatin AmericaWorld

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6

9

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

PeruLatin AmericaWorld

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4

6

8



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5.6

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PeruLatin America

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2014 2015

FOCUSECONOMICS Peru


April 2014

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7


2014 2015

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2000 2005 2010 2015

PeruLatin America

6.0

6.5

7.0

7.5


2014 2015

5

6

7

8

9

10

2000 2005 2010 2015

PeruLatin America

-0.5

0.0

0.5

1.0

1.5


2014 2015

-5.0

-2.5

0.0

2.5

5.0

2000 2005 2010 2015

Peru

Latin America


12 | Manufacturing | evolution of fcst

9 | Manufacturing | variation in %

13 | Unemployment | evolution of fcst


14 | Fiscal Balance | evolution of fcst


Individual Forecasts 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015APOYO Consultoría 5.1 5.4 4.2 5.0 3.7 3.5 - - 0.0 -0.2Banco Bradesco - - - - - - - - - -Banco de Crédito del Perú 5.4 5.5 6.0 9.6 4.0 6.4 - - 0.0 0.2Barclays Capital 5.1 5.2 - - - - - - 0.3 0.8BBVA Banco Continental 5.0 4.8 6.9 5.9 - - - - -0.2 -0.2BofA Merrill Lynch 4.1 4.0 - - - - 6.1 6.3 -0.7 -0.7BTG Pactual 5.5 5.2 4.3 5.5 - - 6.1 5.9 0.2 0.4Capital Economics 4.8 4.5 8.8 7.5 - - 7.0 7.5 1.0 0.0Citigroup Global Mkts 6.3 6.5 5.0 4.9 - - 5.7 5.6 0.0 0.0Credicorp Capital 5.4 5.5 6.0 9.6 4.0 6.4 - - 0.0 0.2Credit Suisse 5.5 5.1 6.1 8.4 - - 6.4 6.1 0.2 0.8Deutsche Bank - - 9.0 9.5 - - 6.9 6.8 0.6 0.5EIU 5.3 5.6 7.5 8.0 6.0 5.8 - - 0.3 0.3Goldman Sachs - - - - - - - - 0.0 0.0HSBC 5.4 6.0 7.0 8.0 3.5 6.8 - - -0.4 0.2IEDEP - CCL 5.7 - 9.1 - 3.7 - - - 0.1 -IPE 5.2 5.3 7.5 8.0 4.3 5.0 - - - -Itaú BBA - - - - - - 6.0 6.0 0.4 0.5JPMorgan - - - - - - - - -0.2 -Macroconsult 5.5 - 6.8 - 4.7 - - - -0.2 -Rimac Seguros 5.7 5.5 - - - - - - - -Santander 5.3 5.2 8.3 8.0 - - 6.2 6.4 0.0 -0.5Scotiabank 5.2 5.2 6.1 6.8 3.9 5.8 - - 0.0 -0.5UBS - - - - 4.2 4.8 6.2 6.0 - -SummaryMinimum 4.1 4.0 4.2 4.9 3.5 3.5 5.7 5.6 -0.7 -0.7Maximum 6.3 6.5 9.1 9.6 6.0 6.8 7.0 7.5 1.0 0.8Median 5.3 5.3 6.9 8.0 4.0 5.8 6.2 6.1 0.0 0.2Consensus 5.3 5.3 6.8 7.5 4.2 5.6 6.3 6.3 0.1 0.1History30 days ago 5.3 5.3 6.8 7.2 4.2 5.6 6.3 6.3 0.0 0.160 days ago 5.4 5.3 6.9 7.6 4.2 5.6 6.1 6.1 0.0 0.090 days ago 5.3 5.1 7.3 7.3 4.3 5.4 6.3 6.5 0.0 0.0

Consumption Investment Manufacturing Unemployment Fiscal Balancevariation in % variation in % variation in % % of active pop. % of GDP

FOCUSECONOMICS Peru


April 2014


15 | Inflation | 2000 - 2018 | in %


19 | Core and Wholesale Prices | var. in %

21 | Sovereign Spreads (EMBI+)

16 | Inflation | Q1 11-Q4 15 | in % Inflation | annual variation of consumer price index in %


20 | Money | variation in %

22 | Stock Market | IGBVL

Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the National Statistical Institute (INEI, Instituto Nacional de Estadistica e Informatica del Peru) and the Central Bank (BCRP, Banco Central de Reserva del Peru). See below for details. Forecasts based on LatinFocus Consensus Forecast. 15 Inflation, annual variation of consumer price index (CPI) in % (eop).

Source: INEI.16 Quarterly inflation, annual variation of consumer price index (CPI) in %

(eop). Source: INEI.17 Inflation, evolution of 2014 inflation forecasts during the last 18 months.18 Inflation, evolution of 2015 inflation forecasts during the last 18 months.19 Core and wholesale price indices, annual variation in % (eop). 2000-

2013. Source: BCRP and INEI respectively.20 Money, annual variation of M2 in %. 2000-2013. Source: BCRP.21 Emerging Markets Bond Index Plus (EMBI+), basis point spread over

US treasuries. January 2008 until end of previous month. Source: JPMorgan.

22 Daily index levels. IGBVL (Indice General de la Bolsa de Valores de Lima). January 2010 until the end of previous week.

Individual Forecasts 2014 2015APOYO Consultoría 2.8 2.0Banco Bradesco - -Banco de Crédito del Perú 2.8 2.4Barclays Capital 2.6 2.6BBVA Banco Continental 2.7 2.3BofA Merrill Lynch 3.9 3.1BTG Pactual 2.7 2.5Capital Economics 2.1 2.3Citigroup Global Mkts 2.5 2.5Credicorp Capital 2.8 2.4Credit Suisse 2.9 2.9Deutsche Bank 2.5 2.7EIU 2.6 2.6Goldman Sachs 3.0 2.5HSBC 2.9 2.5IEDEP - CCL 2.9 3.0IPE 2.5 2.5Itaú BBA 3.0 2.5JPMorgan 3.0 2.5Macroconsult 2.5 -Rimac Seguros - -Santander 2.5 2.5Scotiabank 2.8 2.8UBS 2.3 2.8SummaryMinimum 2.1 2.0Maximum 3.9 3.1Median 2.8 2.5Consensus 2.7 2.6History30 days ago 2.7 2.560 days ago 2.5 2.590 days ago 2.5 2.4Additional ForecastsCentral Bank (Dec. 2013) 1.5-2.5 1.5-2.5IMF (Apr. 2014) 2.3 2.0

-5

0

5

10

2000 2002 2004 2006 2008 2010 2012

Core WPI

0

250

500

750

1,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinPeru

1

2

3

4



-4

0

4

8

12

2000 2005 2010 2015

PeruLatin America

-10

0

10

20

30

40

2000 2002 2004 2006 2008 2010 2012

10,000

15,000

20,000

25,000

Jan Jul Jan Jul Jan Jul Jan Jul Jan

1

2

3

4



2

4

6

8

10

12

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

PeruLatin America

FOCUSECONOMICS Peru


April 2014

2

4

6

8

10

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

PeruLatin America

Monetary Sector | Interest Rate and Exchange Rate

23 | Interest Rate | 2000 - 2018 | in %


27 | Exchange Rate | PEN per USD

29 | PEN per USD 2014 | evol. of fcst

24 | Interest Rate | Q1 11-Q4 15 | in % Policy Interest Rate and Exchange Rate


28 | Exchange Rate | PEN per USD

30 | PEN per USD 2015 | evol. of fcst

Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary and external sector data are from the Central Bank (BCRP, Banco Central de Reserva del Peru). Forecasts based on LatinFocus Consensus Forecast. 23 Interest rate, Central Bank Reference Rate in % (eop). Source: BCRP.24 Quarterly interest rate, Central Bank Reference Rate in % (eop).

Source: BCRP.25 Interest rate, evolution of 2014 forecasts during the last 18 months.26 Interest rate, evolution of 2015 forecasts during the last 18 months.27 Exchange rate, PEN per USD (eop). Source: BCRP.28 Quarterly exchange rate, PEN per USD (eop). Source: BCRP.29 Exchange rate, evolution of 2014 forecast during the last 18 months.30 Exchange rate, evolution of 2015 forecast during the last 18 months.31 Current account balance as % of GDP. Source: BCRP.32 Trade balance, imports and exports, in USD bn. Source: BCRP.33 International reserves, months of imports. Source: BCRP.34 Current account balance as % of GDP, evolution of 2014 and 2015

forecasts during the last 18 months.35 Exports, annual variation in %. Source: BCRP.36 External debt as % GDP. Source: BCRP.

2.0

2.4

2.8

3.2

3.6



2.2

2.4

2.6

2.8

3.0



3

4

5

6



2.4

2.6

2.8

3.0

Q1 11 Q1 12 Q1 13 Q1 14 Q1 152.4

2.8

3.2

3.6

2000 2005 2010 2015

0

5

10

15

20

2000 2005 2010 2015

PeruLatin America

2

3

4

5

6



Individual Forecasts 2014 2015 2014 2015APOYO Consultoría - - 2.90 3.05Banco Bradesco - - 2.83 2.85Banco de Crédito del Perú 4.00 4.00 2.84 2.80Barclays Capital 4.00 5.00 2.85 2.82BBVA Banco Continental 4.00 4.75 2.85 2.88BofA Merrill Lynch 4.30 5.30 2.90 3.00BTG Pactual 3.50 4.00 2.92 2.86Capital Economics 3.75 - 2.90 2.95Citigroup Global Mkts 4.00 4.50 2.85 2.80Credicorp Capital 4.00 4.00 2.84 2.80Credit Suisse 4.00 4.50 2.86 2.84Deutsche Bank 4.50 - 2.90 -EIU - - 2.82 2.85Goldman Sachs 4.00 5.00 2.92 3.02HSBC 4.00 4.00 2.80 2.75IEDEP - CCL - - 2.84 2.86IPE - - - -Itaú BBA 4.00 4.00 2.90 2.95JPMorgan 4.00 - - -Macroconsult - - 2.90 -Rimac Seguros 4.25 4.25 - -Santander 4.00 4.00 2.83 2.75Scotiabank 4.00 4.00 2.76 2.72UBS 4.00 4.25 2.84 2.84SummaryMinimum 3.50 4.00 2.76 2.72Maximum 4.50 5.30 2.92 3.05Median 4.00 4.25 2.85 2.85Consensus 4.02 4.37 2.86 2.86History30 days ago 3.96 4.40 2.86 2.9060 days ago 3.90 4.41 2.84 2.8790 days ago 3.87 4.37 2.83 2.86

Interest Rate Exchange Rate% PEN per USD

FOCUSECONOMICS Peru


April 2014

External Sector | Current Account, Trade and International Reserves



35 | Exports | annual variation in %

32 | Trade Balance | USD billion



Individual Forecasts 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015APOYO Consultoría -5.3 -5.3 -1.3 -1.7 41.8 43.2 43.1 44.9 64.0 61.8Banco Bradesco - - - - - - - - - -Banco de Crédito del Perú -4.5 -4.5 0.2 2.1 44.8 50.6 44.5 48.5 67.0 72.0Barclays Capital -4.6 -4.1 -0.6 0.8 43.1 50.2 43.7 49.3 65.1 63.7BBVA Banco Continental -5.2 -4.8 - - - - - - - -BofA Merrill Lynch -4.9 -3.9 -1.7 -0.6 42.6 46.0 44.3 46.6 62.0 59.0BTG Pactual -4.8 -4.5 -0.2 0.9 42.3 45.3 42.4 44.4 - -Capital Economics -4.0 -3.0 2.0 3.5 49.1 53.5 47.1 50.0 64.0 62.0Citigroup Global Mkts -5.6 -1.5 - - - - - - 70.2 75.3Credicorp Capital -4.5 -4.5 0.2 2.1 44.8 50.6 44.5 48.5 67.0 72.0Credit Suisse -4.6 -3.6 - - - - - - 67.7 72.6Deutsche Bank -4.3 -4.5 - - - - - - - -EIU -4.9 -4.8 0.2 1.8 44.6 49.4 44.4 47.7 66.6 69.2Goldman Sachs -3.5 -2.3 -0.2 1.6 40.8 44.3 41.0 42.8 64.0 63.2HSBC -4.9 -3.7 -1.0 1.1 44.7 50.6 45.8 49.4 66.4 67.6IEDEP - CCL - - 1.2 - 45.9 - 44.7 - - -IPE - - - - 46.1 48.9 46.3 48.7 - -Itaú BBA -4.5 -4.0 - - - - - - 64.0 66.0JPMorgan -4.6 - -0.8 - 49.1 - 49.9 - 64.0 -Macroconsult -5.5 - -2.0 - 44.1 - 46.1 - 67.2 -Rimac Seguros - - - - - - - - - -Santander -5.0 -3.9 -0.4 - 45.5 - 45.8 - 67.7 -Scotiabank -3.9 -3.8 0.2 1.6 43.6 48.3 43.4 46.7 66.3 68.4UBS -5.0 -4.6 0.0 0.4 44.5 48.1 44.5 47.7 - -SummaryMinimum -5.6 -5.3 -2.0 -1.7 40.8 43.2 41.0 42.8 62.0 59.0Maximum -3.5 -1.5 2.0 3.5 49.1 53.5 49.9 50.0 70.2 75.3Median -4.7 -4.0 -0.2 1.3 44.6 48.9 44.5 47.7 66.4 67.6Consensus -4.7 -4.0 -0.3 1.1 44.5 48.4 44.8 47.3 65.8 67.1History30 days ago -4.8 -4.0 -0.6 0.9 44.7 48.5 45.3 47.7 65.7 68.160 days ago -4.9 -4.0 -0.8 0.5 44.8 48.8 45.5 48.3 66.7 69.090 days ago -4.6 -3.9 -0.4 1.1 45.1 49.0 45.7 48.3 67.1 69.1

Current Account Trade Balance Exports Imports Int. Reserves% of GDP USD bn USD bn USD bn USD bn

-5

-4

-3

-2


2014 2015

-6

-3

0

3

6

2000 2005 2010 2015

Peru

Latin America

-40

-20

0

20

40

60

2000 2005 2010 2015

PeruLatin America

-20

0

20

40

60

80

2000 2005 2010 2015


0

20

40

60

2000 2005 2010 2015

Peru

Latin America

0

5

10

15

20

2000 2005 2010 2015

PeruLatin America

FOCUSECONOMICS Peru


April 2014

Fact Sheet

Peru in the Region


Peru3.6%

Brazil38.7%

Mexico21.8%

Argentina8.0%

Venezuela6.6%

Other21.3%

Peru5.2%

Brazil33.6%

Mexico19.9%

Colombia7.9%

Argentina7.0%

Other26.4%

U.S.A.24.2%

EU-2710.5%

Other Asia ex-Japan

8.6%China13.8%

Other LatAm20.8%

Brazil6.2%

Ecuador5.1%

Other10.8%

U.S.A.14.0%

Switzerland11.1%

Canada7.5%

Japan5.7%

EU-2717.1%

Other Asia ex-Japan

5.8%

China17.1%

LatAm18.7%

Other2.9%

Other2.8%


Mineral Fuels14.7%

Food10.5%

Other1.3%


Ores & Metals50.5%

Mineral Fuels12.2%

Food21.3%

Trade Structure



Economic Structure


Exports

Exports

Imports

Imports

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

0

20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



• Large informal economy

• Succesfully contained inflation

. .

• Pragmatic approach to economic policy

• Strong international reserves position

• Pronounced socioeconomic inequalities• High dependence on commodity prices

Energy (2010) Primary Energy Production (trillion Btu): 808Primary Energy Consumption (trillion Btu): 848Electricity Generation (billion kW-h): 33.3Electricity Consumption (billion kW-h): 29.6Oil Supply (thousand bpd): 164Oil Consumption (thousand bpd): 193CO2 Emmissions (million metric tons): 41.9

Agency Rating OutlookMoody’s: Baa2 PositiveS&P: BBB+ StableFitch Ratings: BBB+ Stable


Transportation (2012) Airports: 191Railways (km): 1,906Roadways (km): 137,327Waterways (km): 8,808Chief Ports: Callao, Chimbote, Matarani

Official name: Republic of PeruCapital: Lima (8.7m)Other cities: Arequipa (0.8m)

Trujillo (0.7m)Area (km2): 1,285,216Population (million, 2013 est.): 30.946Population density (per km2, 2012): 24.1Population growth rate (%, 2012 est.): 1.0Life expectancy (years, 2012 est.): 72.7Illiteracy rate (%, 2007): 7.1Language: Spanish, Quechua and

AymaraMeasures: Metric systemTime: GMT-5

President: Ollanta Moises Humala TassoLast elections: 10 April 2011Next elections: April 2016Central Bank President: Julio Velarde Flores

FOCUSECONOMICS Venezuela


April 2014

Venezuela

REAL SECTOR | Car sales remain in the doldrums in March The free fall in car sales continued in March, plunging 86.1% over the same month last year and reaching just 1,674 units according to figures from the Venezuelan Automotive Chamber (CAVENEZ, Camara Automotriz de Venezuela). The reading followed the 89.9% decline recorded in February, which had marked the sharpest drop since December 2002.

In the 12 months up to March, car sales reached just 76,452 units, which was 37.8% lower than the level observed in the same period last year (February: -31.2% year-on-year) and marked the lowest level since March 2004. Car sales currently total less than a sixth of the 491,899-unit peak recorded in the full year 2007. Extreme supply shortages following government restrictions on both assembly plants and importers have severely hampered sales of vehicles in recent years.

Venezuelan authorities have not released real sector data since 26 November when they published the national accounts for Q3 2013. In addition, the Central Bank has not updated inflation data since December 2013. Instead, the Bank published the January and February inflation data on its website via press releases, which have unusually strong ideological and pro-government wording. This led many analysts to suspect that the government had increased its pressure on the Central Bank, which had always been considered one of the most reliable institutions in Venezuela.

Given the limited availability of timely data for the real sector, analysts often use car sales as a proxy for private consumption. LatinFocus Consensus

Following the introduction of the Second Complementary Administration System for Foreign Exchange—the so-called “Sicad II”—the parallel exchange rate strengthened slightly. The Sicad II exchange rate is currently trading at around 49.0 VEF per USD, while the currency traded at around 64.3 VEF per USD in the black market. Meanwhile, on 1 April, President Nicolas Maduro announced that the government is preparing a fiscal reform. Analysts believe that the reform will include an increase in the non-oil tax burden.

Panelists see GDP falling 1.2% in 2014, which is down 0.4 percentage

points from last month’s estimate. Panelists expect GDP to expand 1.5% in 2015.

Annual inflation edged up from 56.3% in January to 57.3% in

February. The FocusEconomics panel sees inflation at 58.8% by the end of 2014. Next year, the panel sees inflation moderating to 48.5%.

Outlook worsens


Ricard TornéSenior Economist

Venezuela

2010-12 2013-15 2016-18Population (million): 29.1 30.5 31.9GDP (USD bn): 312 445 678GDP per capita (USD): 10,694 14,632 21,334GDP growth (%): 2.7 0.6 2.4Fiscal Balance (% of GDP): -4.2 -3.3 -2.2Public Debt (% of GDP): 27.6 29.5 24.7Inflation (%): 25.1 52.4 39.4Current Account (% of GDP): 4.8 2.6 1.4External Debt (% of GDP): 35.7 28.5 23.2

Car Sales

Note: Year-on-year variation and 12-month sum of domestic car sales in thousand units.Source: Venezuelan Automobile Chamber (CAVENEZ).

75

100

125

150

-100

-50

0

50


Year-on-year (left scale)

12-month sum (right scale)

%



April 2014

Forecast panelists expect private consumption to decline 0.4% this year, which is down 0.5 percentage points from the previous month’s estimate. In 2015 the panel sees private consumption growth at 2.6%.

The 2014 budget assumes that the economy will grow between 4.0% and 6.0% this year. LatinFocus Consensus Forecast panelists, however, expect GDP to contract 1.2% this year, which is down 0.4 percentage points from last month’s projection. Next year, the panel sees economic growth at 1.5%.

MONETARY SECTOR | Non-official exchange rate appreciates following Sicad II’s introductionOn 24 March, the government launched the long-awaited Second Complementary Administration System for Foreign Exchange (Sicad II). The new system allows the dollar to trade freely in the market through approved intermediary institutions. On its first day under the Sicad II system, the bolivar traded at a weighted average of 51.9 VEF per USD, which represented a de facto devaluation of 723% over the official exchange rate of 6.30 VEF per USD. Although no information was provided on the volume of the transactions, market participants suggest the total amount of funds available in the auction was as little as USD 500,000.

Following the introduction of the Sicad II, the exchange rate in the parallel market gained ground. On 24 March, the non-official exchange rate traded at 57.0 VEF per USD, which was 31.7% stronger than in the same day of the previous month and marked the highest level since November 2013. That said, the bolivar was still 143% weaker on a year-on-year basis.

Subsequently, the exchange rate from the Sicad II system remained broadly stable. On 9 April, the rate was 49.1 VEF per USD. Conversely, the non-official exchange rate weakened slightly and traded at 64.6 VEF per USD. Meanwhile, the latest auction on the secondary exchange rate system, known as Sicad, offered an exchange rate of 10.0 VEF per USD.

Meanwhile, on 31 March, the Central Bank increased the bank reserve rate by 1.0 percentage points to 21.5%, in an attempt to contain monetary expansion and tame the country’s record inflation.

LatinFocus Consensus Forecast panelists see the official exchange rate ending this year at 9.16 VEF per USD, which is stronger compared to the 10.65 VEF per USD expected last month. Next year, the panel sees the bolivar depreciating further to 13.32 VEF per USD.

LatinFocus Consensus Forecast panelists expect a Sicad II exchange rate of 50.5 VEF per USD in 2014. Next year, the panel sees the bolivar under the Sicad II system weakening to 57.8 VEF per USD.

Despite the introduction of the Sicad II system, LatinFocus Consensus Forecast panelists still expect a sizeable activity in the black market, with a non-official exchange rate projection of 71.3 VEF per USD by the end of this year. In 2015, the panel sees the non-official exchange rate depreciating to 81.3 VEF per USD.

EXTERNAL SECTOR | Venezuelan oil price declines slightly in March In March, the average price of Venezuela’s mix of crude oil fell 1.7% over the previous month to USD 96.0 per barrel. The reading, which contrasted the 2.2% increase recorded in February, mainly reflected higher crude stockpiles

Exchange Rate | VEF per USD

Note: Official, non-official and Sicad II exchange rate of Venezuelan bolivar (VEF) against U.S. dollar (USD).Source: Thomson Reuters Datastream, Venezuela Central Bank (BCV) and local sources.

0

20

40

60

80

100

Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14

Official exchange rateNon-official exchange rateSicad 2 exchange rate



April 2014

in the United States, a relatively-strong U.S. dollar and concerns about a deceleration in emerging economies.

According to the latest report from the Organization of Petroleum Exporting Countries (OPEC), Venezuelan oil production reached 2.34 million barrels per day (mbpd) in March, which was broadly in line with the 2.33 mbpd tallied in the previous month.

LatinFocus Consensus Forecast panelists expect oil prices to average USD 96.2 per barrel this year, which is up USD 0.8 per barrel over last month’s projection. In 2015, the panel sees oil prices rising to USD 97.9 per barrel.

Oil Prices | USD per barrel

Note: Price of the Venezuelan mix of crude oil in USD per barrel.Source: Ministry of Petroleum and Mining.

25

50

75

100

125

150

Jan-08Jul-08Jan-09Jul-09Jan-10Jul-10Jan-11Jul-11Jan-12Jul-12Jan-13Jul-13Jan-14



April 2014


Annual Data 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Real Sector Population (million) 28.2 28.6 29.1 29.5 30.0 30.5 30.9 31.4 31.9 32.4GDP per capita (USD) 11,673 8,337 10,859 12,885 12,739 15,871 15,287 18,629 20,997 24,375GDP (USD bn) 329 239 316 380 382 483 472 583 666 784Economic Growth (GDP, annual var. in %) -3.2 -1.5 4.2 5.6 1.5 -1.2 1.5 2.0 2.4 2.7Domestic Demand (annual var. in %) -7.7 -0.5 7.6 12.3 -0.1 -1.9 2.1 2.1 2.5 3.5Private Consumption (annual var. in %) -2.9 -1.9 4.0 7.0 3.9 -0.4 2.6 2.8 3.1 3.3Government Consumption (annual var. in %) 1.5 2.1 5.9 6.3 3.3 1.3 3.5 3.6 3.7 3.8Fixed Investment (annual var. in %) -8.3 -6.3 4.4 23.3 -4.6 -6.1 2.2 2.2 2.3 2.7Manufacturing (annual var. in %, aop) -6.4 -3.4 3.8 1.8 0.1 -0.2 1.5 1.8 2.2 2.7Car Sales (annual var. in %) -49.7 -8.3 -3.7 8.2 -24.3 - - - - -Unemployment (% of active population, aop) 7.9 8.5 8.2 7.8 7.5 8.3 8.0 7.9 7.6 7.5Fiscal Balance (% of GDP) -5.0 -3.6 -4.0 -4.9 -4.8 -2.5 -2.7 -2.5 -2.2 -1.8Public Debt (% of GDP) 18.2 30.1 25.1 27.6 30.2 30.2 28.1 26.6 24.6 22.9Monetary and Financial Sector Money (annual var. of M2 in %) 14.3 19.1 50.6 61.0 69.7 58.6 45.8 40.9 38.5 34.5Inflation (CPI, annual var. in %, eop) 25.1 27.2 27.6 20.1 56.2 58.8 48.5 41.7 37.2 30.6Inflation (CPI, annual var. in %, aop) 27.1 28.2 26.1 21.1 40.6 57.8 59.7 45.1 39.4 33.9Inflation (Core, annual var. in %, eop) 29.9 27.5 27.8 21.4 60.3 - - - - -Inflation (WPI, annual var. in %, eop) 24.8 26.8 20.8 16.6 52.4 - - - - -90-Day Average Deposit Rate (%, eop) 15.1 14.6 14.5 14.5 14.7 16.0 16.9 17.0 17.1 17.2Stock Market (IBC, variation in %) 57.0 18.6 79.1 302.8 480.5 - - - - -Exchange Rate (VEF per USD, eop) 2.15 4.30 4.30 4.30 6.30 9.16 13.32 16.28 20.44 22.16Exchange Rate (VEF per USD, aop) 2.15 4.26 4.30 4.30 6.09 7.54 12.44 14.80 18.36 21.30External Sector Current Account Balance (% of GDP) 0.7 3.7 7.7 2.9 2.9 2.2 2.5 1.7 1.4 1.1Current Account Balance (USD bn) 2.3 8.8 24.4 11.0 11.2 10.8 12.0 10.1 9.5 8.9Trade Balance (USD bn) 16.4 27.2 46.0 38.0 36.7 37.1 36.9 37.6 38.4 39.2Exports (USD bn) 57.6 65.7 92.8 97.3 90.8 87.7 89.5 93.8 98.1 103.5Imports (USD bn) 40.7 38.5 46.8 59.3 54.1 50.6 52.6 56.2 59.7 64.4Exports (annual variation in %) -39.4 14.1 41.2 4.9 -6.7 -3.5 2.1 4.8 4.6 5.5Imports (annual variation in %) -21.0 -5.2 21.5 26.8 -8.8 -6.6 4.0 6.9 6.3 7.7Venezuelan Oil Price (USD per barrel, aop) 57.0 72.0 101.1 103.4 99.5 96.2 97.9 99.3 100.4 101.2International Reserves (USD bn) 35.0 29.5 29.9 29.9 21.5 21.5 22.9 24.2 24.7 24.9International Reserves (months of imports) 10.3 9.2 7.7 6.0 4.8 5.1 5.2 5.2 5.0 4.7External Debt (USD bn) 81.9 97.1 110.7 118.9 121.9 125.8 129.3 146.7 151.3 169.9External Debt (% of GDP) 24.9 40.7 35.1 31.3 31.9 26.1 27.4 25.2 22.7 21.7 Quarterly Data Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15Economic Growth (GDP, annual var. in %) 1.1 1.5 -1.2 -1.9 -1.3 -0.5 1.1 1.1 1.7 2.1Private Consumption (annual var. in %) 4.2 1.9 -0.4 -0.5 -0.6 -0.2 1.7 1.8 2.6 4.3Fixed Investment (annual var. in %) -14.4 -10.1 -4.8 -6.5 -6.5 -6.5 -0.5 1.7 2.3 5.3Unemployment (% of active population, aop) 7.8 6.6 8.1 8.5 8.4 8.3 8.2 8.1 7.9 7.6Inflation (CPI, annual var. in %, eop) 49.4 56.2 57.6 57.9 58.2 58.8 64.8 61.2 59.1 48.590-Day Average Deposit Rate (%, eop) 14.5 14.7 14.5 15.0 15.6 16.0 16.2 16.4 16.7 16.9Exchange Rate (VEF per USD, eop) 6.30 6.30 6.30 7.44 8.70 9.16 12.57 12.83 13.10 13.32Exchange Rate (VEF per USD, aop) 6.30 6.30 6.30 6.87 8.07 8.93 10.87 12.70 12.97 13.21Current Account Balance (% of GDP) 4.3 2.2 1.8 2.1 2.6 2.3 2.2 2.9 2.9 2.0Current Account Balance (USD bn) 4.1 2.4 2.1 2.5 3.0 2.8 2.4 3.1 3.4 2.6Trade Balance (USD bn) 10.2 8.6 8.8 9.5 10.0 8.1 9.0 9.5 9.7 7.8Exports (USD bn) 22.2 24.7 21.2 22.0 22.2 21.6 21.6 22.6 23.1 22.2Imports (USD bn) 12.0 16.0 12.5 12.5 12.2 13.6 12.6 13.2 13.3 14.4 Monthly Data Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14Manufacturing (annual var. in %) -0.3 4.0 -1.7 0.8 - - - - - -Car Sales (annual var. in %) -39.1 -21.6 -24.8 -20.2 -26.5 -51.1 -63.9 -87.0 -89.9 -86.1Unemployment (% of active population) 6.9 7.6 8.0 7.8 7.6 6.6 5.6 9.5 7.2 -Inflation (CPI, mom variation in %) 4.70 3.19 3.01 4.39 5.11 4.82 2.22 3.30 2.40 -Inflation (CPI, annual var. in %) 39.6 42.6 45.4 49.4 54.3 58.2 56.2 56.3 57.3 -Exchange Rate (VEF per USD, eop) 6.30 6.30 6.30 6.30 6.30 6.30 6.30 6.30 6.30 6.30Venezuela Oil Price (USD per barrel, aop) 99.1 101.0 103.6 102.8 98.1 94.5 97.3 95.5 97.6 96.0



April 2014


1 | Real GDP | 2000 - 2018 | var. in %







8 | Investment | evolution of forecasts

Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the National Statistical Institute (INE, Instituto Nacional de Estadistica), the Central Bank (BCV, Banco Central de Venezuela) and the Ministry of Energy (Menpet, Ministerio del Poder Popular para la Energia y Petroleo). See below for details. Forecasts based on LatinFocus Consensus Forecast. 1 GDP, annual variation in %. Source: BCV.2 Quarterly GDP (not seasonally adjusted), year-on-year variation in %.

Source: BCV.3 GDP, evolution of 2014 forecasts during the last 18 months.4 GDP, evolution of 2015 forecasts during the last 18 months.5 Private consumption, annual variation in %. Source: BCV.6 Gross fixed investment, annual variation in %. Source: BCV.7 Private consumption, change in 2014 and 2015 forecasts during the last

18 months.8 Gross fixed investment, change in 2014 and 2015 forecasts during the

last 18 months.9 Oil price, average USD per barrel. Source: Menpet.10 Unemployment, % of active population. Source: INE.11 Balance of non-financial central government as % of GDP. Source:

BCV.12 Oil price, evolution of 2014 and 2015 forecasts during the last 18

months.13 Unemployment, evolution of 2014 and 2015 forecasts during the last 18

months.14 Balance of non-financial central government as % of GDP, evolution of

2014 and 2015 forecasts during the last 18 months.

Individual Forecasts 2014 2015Azpurua García Velázquez -0.3 0.5Banco Espirito Santo -1.0 -Banco Mercantil -0.6 -Banesco -1.0 2.6Barclays Capital -1.8 2.5BofA Merrill Lynch -1.9 3.1Capital Economics -3.0 0.5Citigroup Global Mkts -1.0 1.9Credit Suisse -0.5 1.0Deutsche Bank 0.5 3.5Dinámica Venezuela 0.5 1.8Ecoanalítica -2.4 1.4Econometrica -2.5 -EIU -1.9 0.2Goldman Sachs -1.3 0.5HSBC -3.6 -0.6JPMorgan -1.0 2.5Polinomics -1.0 -UBS 0.5 0.4SummaryMinimum -3.6 -0.6Maximum 0.5 3.5Median -1.0 1.4Consensus -1.2 1.5History30 days ago -0.8 1.860 days ago -0.5 1.890 days ago -0.1 1.7Additional Forecasts Government (Oct. 2013) 4.0 - 6.0 -IMF (Apr. 2014) -0.5 -1.0World Bank (Jan. 2014) 0.5 1.7

-10

0

10

20

2000 2005 2010 2015

VenezuelaLatin AmericaWorld

-4

-2

0

2

4

6

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

VenezuelaLatin AmericaWorld

-3

0

3

6



-6

-3

0

3

6



-1

0

1

2

3

4


2014 2015

-10

0

10

20

2000 2005 2010 2015

VenezuelaLatin America

-40

-20

0

20

40

60

2000 2005 2010 2015

Venezuela

Latin America

-10

-5

0

5


2014 2015



April 2014


12 | Oil Price | evolution of forecasts

9 | Oil Price | USD per barrel





95

100

105

110


2014 2015

0

25

50

75

100

125

2000 2005 2010 2015

7.8

8.0

8.2

8.4

8.6

8.8


2014 2015

5

10

15

20

2000 2005 2010 2015


-5

-4

-3

-2


2014 2015

-8

-4

0

4

2000 2005 2010 2015


Individual Forecasts 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015Azpurua García Velázquez - - - - - - -3.0 -2.9 95.0 95.0Banco Espirito Santo - - - - - - - - - -Banco Mercantil 2.0 - -9.0 - 7.6 - -3.4 - 97.9 -Banesco 0.8 2.9 - - 8.0 7.8 - - 96.0 98.0Barclays Capital -2.1 2.8 -5.4 3.1 - - - - 98.6 100.4BofA Merrill Lynch -4.7 4.0 -4.6 2.7 9.0 8.9 1.0 -1.0 96.6 96.6Capital Economics -1.0 0.5 -1.0 3.0 - - - - - -Citigroup Global Mkts 0.1 0.3 -3.6 1.5 - - - - - -Credit Suisse 2.8 3.5 -3.5 0.0 - - -1.9 -0.3 - -Deutsche Bank 3.5 5.0 2.5 8.0 8.5 8.0 - - - -Dinámica Venezuela 2.7 3.4 -2.3 0.4 7.8 7.7 -5.4 -4.5 98.6 99.0Ecoanalítica -5.5 2.6 -4.5 2.1 9.7 7.3 -1.7 -2.4 95.1 98.2Econometrica -2.2 - -7.0 - - - - - 92.0 -EIU -1.4 1.8 -4.0 1.0 7.8 7.8 - - - -Goldman Sachs - - - - - - - - - -HSBC -3.5 1.8 -6.5 0.5 - - - - - -JPMorgan - - - - - - -4.0 - - -Polinomics 2.5 - -30.0 - - - - - - -UBS - - - - 8.2 8.2 -1.9 -5.0 - -SummaryMinimum -5.5 0.3 -30.0 0.0 7.6 7.3 -5.4 -5.0 92.0 95.0Maximum 3.5 5.0 2.5 8.0 9.7 8.9 1.0 -0.3 98.6 100.4Median -0.4 2.8 -4.5 1.8 8.1 7.8 -2.5 -2.7 96.3 98.1Consensus -0.4 2.6 -6.1 2.2 8.3 8.0 -2.5 -2.7 96.2 97.9History30 days ago 0.1 2.7 -5.3 2.5 8.1 7.9 -4.1 -3.1 95.4 98.260 days ago 0.4 2.9 -4.5 2.6 8.1 7.9 -3.8 -3.4 95.4 98.290 days ago 0.5 2.6 -3.6 2.3 8.2 8.2 -3.8 -3.3 97.3 98.3

Consumption variation in %

Investment variation in %

Oil Price USD per barrel

Unemployment % of active pop.

Fiscal Balance % of GDP



April 2014


15 | Inflation | 2000 - 2018 | in %


19 | Core and Wholesale Prices | % var.

21 | Sovereign Spreads (EMBI+)

16 | Inflation | Q1 11-Q4 15 | in % Inflation | annual variation of consumer price index in %


20 | Money | variation in %

22 | Stock Market | IBC

Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary sector data are from the National Statistical Institute (INE, Instituto Nacional de Estadistica) and the Central Bank (BCV, Banco Central de Venezuela). See below for details. Forecasts based on LatinFocus Consensus Forecast. 15 Inflation, annual variation of consumer price index (CPI) in % (eop).

Source: BCV.16 Quarterly inflation, annual variation of consumer price index (CPI) in %

(eop). Source: BCV.17 Inflation, evolution of 2014 forecasts during the last 18 months.18 Inflation, evolution of 2015 forecasts during the last 18 months.19 Core and wholesale price indices, annual variation in % (eop). 2000-

2013. Source: BCV.20 Money, annual variation of M2 in %. Source: BCV.21 Emerging Markets Bond Index Plus (EMBI+), basis point spread over

US treasuries. Source: JPMorgan. Jan. 2008 until end of previous month.

22 Daily index levels. IBC (Indice de la Bolsa de Valores de Caracas). Jan. 2010 until end of previous week.

Individual Forecasts 2014 2015Azpurua García Velázquez 60.2 52.5Banco Espirito Santo 70.0 -Banco Mercantil 49.5 -Banesco 43.1 44.3Barclays Capital 59.5 40.8BofA Merrill Lynch 49.4 69.3Capital Economics 65.0 50.0Citigroup Global Mkts 75.0 80.0Credit Suisse 43.5 37.0Deutsche Bank 55.0 60.0Dinámica Venezuela 58.4 45.5Ecoanalítica 76.1 48.4Econometrica 75.0 -EIU 65.8 30.8Goldman Sachs 58.1 37.9HSBC 59.4 50.6JPMorgan 53.3 35.0Polinomics 55.0 -UBS 45.0 45.0SummaryMinimum 43.1 30.8Maximum 76.1 80.0Median 58.4 45.5Consensus 58.8 48.5History30 days ago 59.0 46.760 days ago 57.1 44.590 days ago 51.7 40.9Additional Forecasts Government (Oct. 2013) 26 - 28 -IMF (Apr. 2014) 75.0 75.0

10

30

50

70

2000 2002 2004 2006 2008 2010 2012

Core WPI

0

500

1,000

1,500

2,000

2008 2009 2010 2011 2012 2013 2014

EMBI + LatinVenezuela

20

40

60

80

100



0

20

40

60

2000 2005 2010 2015


0

30

60

90

120

2000 2005 2010 2015

0

500

1,000

1,500

2,000

2,500

3,000

Jan Jul Jan Jul Jan Jul Jan Jul Jan

20

40

60

80

100



0

20

40

60

80

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15




April 2014

Monetary Sector | Interest Rate and Exchange Rate

23 | Interest Rate | 2000 - 2018 | in %


27 | Exchange Rate | VEF per USD

29 | VEF per USD 2014 | evol. of fcst

24 | Interest Rate | Q1 11-Q4 15 | in % Policy Interest Rate and Exchange Rate


28 | Exchange Rate | VEF per USD

30 | VEF per USD 2015 | evol. of fcst

Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary and external sector data are from the Central Bank (BCV, Banco Central de Venezuela). Forecasts based on LatinFocus Consensus Forecast. 23 Interest rate, weighted average of 90-day deposit rate of 6 major

commercial banks in % (eop). 24 Quarterly interest rate, weighted average of 90-day deposit rate of 6

major commercial banks in % (eop).25 Interest rate, evolution of 2014 forecasts during the last 18 months.26 Interest rate, evolution of 2015 forecasts during the last 18 months.27 Exchange rate, VEF per USD (eop).28 Quarterly exchange rate, VEF per USD (eop).29 Exchange rate, evolution of 2014 forecast during the last 18 months.30 Exchange rate, evolution of 2015 forecast during the last 18 months.31 Current account balance as % of GDP.32 Trade balance, imports and exports, in USD bn.33 International reserves, months of imports.34 Current account balance in USD bn, change in 2014 and 2015 forecasts

during the last 18 months.35 Exports, annual variation in %.36 External debt as % of GDP. Source: BCV and FocusEconomics

calculations.

5

10

15

20

25



5

10

15

20

25



10

15

20

25



3

6

9

12

15

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

5

10

15

20

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15


0

5

10

15

20

25

2000 2005 2010 2015

0

10

20

30

2000 2005 2010 2015


10

15

20

25



Individual Forecasts 2014 2015 2014 2015Azpurua García Velázquez 14.0 14.0 9.40 12.00Banco Espirito Santo - - - -Banco Mercantil 14.5 - 6.30 -Banesco 14.5 14.5 6.30 10.20Barclays Capital - - 6.30 6.30BofA Merrill Lynch - - 6.30 16.50Capital Economics - - - -Citigroup Global Mkts - - 12.00 19.80Credit Suisse 14.5 14.5 12.93 19.79Deutsche Bank - - 6.30 -Dinámica Venezuela 17.3 18.4 6.30 9.30Ecoanalítica 18.1 16.7 6.30 11.00Econometrica 16.5 - 15.00 -EIU 17.0 19.0 6.28 6.28Goldman Sachs 20.0 22.0 9.50 12.40HSBC - - 15.00 23.00JPMorgan - - - -Polinomics 14.0 - 11.30 -UBS 15.1 16.0 11.00 13.30SummaryMinimum 14.0 14.0 6.28 6.28Maximum 20.0 22.0 15.00 23.00Median 15.1 16.3 7.85 12.20Consensus 16.0 16.9 9.16 13.32History30 days ago 15.6 16.2 10.65 13.5660 days ago 15.6 16.2 10.56 13.5890 days ago 15.6 16.4 10.84 13.87

Interest Rate Exchange Rate% VEF per USD



April 2014

External Sector | Current Account, Trade and International Reserves



35 | Exports | annual variation in %




Individual Forecasts 2014 2015 2014 2015 2014 2015 2014 2015 2014 2015Azpurua García Velázquez 8.0 7.0 36.0 34.0 84.0 84.0 48.0 50.0 21.5 20.8Banco Espirito Santo - - - - - - - - - -Banco Mercantil 8.4 - 34.4 - 88.7 - 54.3 - 19.4 -Banesco - - 32.4 35.3 87.2 90.3 54.8 55.1 - -Barclays Capital 15.0 18.6 38.8 40.5 84.7 88.5 45.9 47.9 21.1 21.8BofA Merrill Lynch 17.4 21.5 42.9 44.5 87.9 90.6 45.0 46.1 19.1 21.3Capital Economics 2.0 1.0 - - - - - - - -Citigroup Global Mkts 14.9 18.2 - - - - - - 23.5 22.0Credit Suisse 5.0 3.9 - - - - - - 18.1 16.8Deutsche Bank 14.0 15.0 45.0 38.0 95.0 98.0 50.0 60.0 25.0 30.0Dinámica Venezuela 6.2 3.4 28.7 27.1 82.9 85.1 54.2 58.0 26.4 29.1Ecoanalítica 21.2 21.2 37.7 39.1 88.0 91.3 50.4 52.2 25.7 27.9Econometrica 10.0 - 37.0 - 89.0 - 52.0 - 24.0 -EIU 8.4 8.2 36.3 39.3 86.0 90.7 49.8 51.4 20.1 19.8Goldman Sachs 9.4 6.1 37.2 34.7 90.7 89.1 53.5 54.5 17.6 15.4HSBC 13.1 22.3 41.2 43.3 89.1 92.6 47.9 49.3 17.4 27.0JPMorgan 10.4 - 37.3 - 86.2 - 48.9 - - -Polinomics 10.2 - 35.7 - 86.5 - 50.9 - - -UBS 9.7 9.5 36.0 30.4 88.9 84.4 53.0 54.0 - -SummaryMinimum 2.0 1.0 28.7 27.1 82.9 84.0 45.0 46.1 17.4 15.4Maximum 21.2 22.3 45.0 44.5 95.0 98.0 54.8 60.0 26.4 30.0Median 10.0 9.5 37.0 38.0 87.9 90.3 50.4 52.2 21.1 21.8Consensus 10.8 12.0 37.1 36.9 87.7 89.5 50.6 52.6 21.5 22.9History30 days ago 10.9 11.9 36.3 36.2 88.2 90.9 51.9 54.7 21.0 22.060 days ago 10.8 11.5 36.9 36.8 88.9 91.2 52.0 54.4 21.6 22.990 days ago 12.1 13.0 38.6 38.9 90.9 92.1 52.3 53.2 23.3 22.2

Imports Int. ReservesUSD bn USD bn USD bn

Current Account Trade Balance USD bn USD bn

Exports

0

5

10

15

20

25


2014 2015

-5

0

5

10

15

20

2000 2005 2010 2015


-50

-25

0

25

50

75

2000 2005 2010 2015


0

25

50

75

100

125

2000 2005 2010 2015


10

20

30

40

50

60

2000 2005 2010 2015

Venezuela

Latin America

0

10

20

30

2000 2005 2010 2015




April 2014

Fact Sheet

Venezuela in the Region


Venezuela6.7%

Brazil39.6%

Mexico20.9%

Argentina8.4%

Colombia6.5%

Other17.8%

Venezuela5.0%

Brazil33.7%

Mexico19.9%

Colombia7.9%

Argentina7.0%

Other26.5%

U.S.A.30.1%

EU-2713.5%

China15.9%

Other LatAm19.6%

Brazil8.6%

Other12.2%

U.S.A.39.4%

EU-275.5%

China14.5%

India12.1%

LatAm7.6%

Other20.9%

Other3.9%


Food15.4%

Other4.7%

Mineral Fuels95.3%

Trade Structure



Economic Structure


Exports

Exports

Imports

Imports

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

0

20

40

60

80

1002002-04 2005-07 2008-10

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



• Substantial oil wealth • Dependence on oil• High revenues from oil exports • Polarized economic policy• Progress in health and education • Persistent inflation• Membership of Mercosur • Exchange rate misalignments

Energy (2010)Primary Energy Production (trillion Btu): 7,003Primary Energy Consumption (trillion Btu): 3,321Electricity Generation (billion kW-h): 115Electricity Consumption (billion kW-h): 91.5Oil Supply (thousand bpd): 2,405Oil Consumption (thousand bpd): 718CO2 Emmissions (million metric tons): 174

Agency Rating OutlookMoody’s: B2 NegativeS&P: B- NegativeFitch Ratings: B Negative

Communications (2012) Telephones - main lines (per 100 inhabitants): 25.6Telephones - mobile cellular (per 100 inhabit.): 102Internet Users (per 100 inhabitants): 44.0Broadband Subscriptions (per 100 inhabitants): 6.7

Transportation (2012) Airports: 492Railways (km): 806Roadways (km): 96,155Waterways (km): 7,100Chief Ports: La Guaira, Maracaibo

Official name: Bolivarian Republic of Venezuela

Capital: Caracas (5.6m)Other cities: Maracaibo (4.1m)

Valencia (2.6m)Area (km2): 912,050Population (million, 2013 est.): 30.0Population density (per km2, 2012 est.): 32.9Population growth rate (%, 2012 est.): 1.5Life expectancy (years, 2012 est.): 74.1Illiteracy rate (%, 2001): 7.0Language: SpanishMeasures: Metric systemTime: GMT-4.30

President: Nicolas Maduro MorosLast elections: 14 April 2013Next elections: 2018Central Bank President: Nelson Merentes Diaz

FOCUSECONOMICS Bolivia


April 2014

BoliviaOutlook stable


Carl KellyEconomist

Bolivia

4 | GDP | evolution of forecasts

1 | GDP | variation in %



6 | Inflation | evolution of forecasts

3 | Inflation | in %

-0.3

0.0

0.3

0.6

0.9

1.2


2014 2015

4.5

4.7

4.9

5.1

5.3


2014 2015

-4

0

4

8

2000 2003 2006 2009 2012 2015

BoliviaLatin AmericaWorld

4.3

4.6

4.9

5.2

5.5


2014 2015

0

5

10

15

2000 2003 2006 2009 2012 2015

BoliviaLatin America

-10

-5

0

5

2000 2003 2006 2009 2012 2015

Bolivia

Latin America

2007-09 2010-12 2013-15Population (million): 10.0 10.6 11.2GDP (USD bn): 15.7 23.3 32.6GDP per capita (USD): 1,564 2,187 2,892GDP growth (%): 4.7 4.8 5.1Fiscal Balance (% of GDP): 1.8 1.4 0.0Public Debt (% of GDP): 39.2 35.5 31.8Inflation (%): 8.6 5.6 5.6Current Account (% of GDP): 9.2 4.3 3.6External Debt (% of GDP): 34.6 34.7 33.1

In January, economic activity increased 6.1% over the same month of last year, which was down from the record high 10.3% expansion registered in December. January’s increase was driven by higher growth in the oil and gas industry, whereas output in most other sectors decelerated. On 4 April President Evo Morales signed a law which creates a new framework for foreign investment in Bolivia. Since taking office in 2006, Morales has nationalized several international companies in key sectors. While the new law seeks to encourage foreign investment and provide guarantees to international firms, it prioritizes domestic development and gives precedence to national norms over international courts in case of arbitration.

LatinFocus panelists expect the economy to expand 5.3% in 2014, which is unchanged from last month’s forecast. For 2015, participants expect the economy to grow 4.7%.

Annual inflation inched down from 6.2% in February to 6.1% in March. LatinFocus panelists expect inflation to end 2014 at 5.4% and to moderate to 4.9% in 2015.

Other Countries



April 2014


7 | Exchange Rate | BOB per USD

9 | BOB per USD | evolution of fcst



Notes and sources

General: Long-term chart period from 2000 to 2015 unless otherwise stated. All data are from the National Statistical Institute (INE, Instituto Nacional de Estadistica) and the Central Bank (BCB, Banco Central de Bolivia). See below for details. Forecasts based on LatinFocus Consensus Forecast. 1 GDP, annual variation in %. Source: INE.2 Balance of non-financial public sector as % of GDP. Source: BCB.3 Inflation, annual variation of consumer price index (CPI) in % (eop).

Source: INE.4 GDP, evolution of 2014 and 2015 forecasts during the last 18 months.5 Balance of non-financial public sector as % of GDP, evolution of 2014

and 2015 forecasts during the last 18 months.6 Inflation, evolution of 2014 and 2015 forecasts during the last 18

months.7 Exchange rate, BOB per USD (eop). Source: Thomson Reuters.8 Current account balance as % of GDP. Source: BCB.9 Exchange rate, evolution of 2014 and 2015 forecasts during the last 18

months.10 Current account balance as % of GDP, evolution of 2014 and 2015

forecasts during the last 18 months.

6.0

6.5

7.0

7.5

8.0

8.5

2000 2003 2006 2009 2012 2015

1

2

3

4

5


2014 2015

6.7

6.8

6.9

7.0

7.1


2014 2015

-10

-5

0

5

10

15

2000 2003 2006 2009 2012 2015

BoliviaLatin America

Annual Data 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Real Sector Population (million) 9.6 9.8 10.0 10.2 10.4 10.6 10.8 11.0 11.2 11.5GDP per capita (USD) 1,190 1,335 1,663 1,696 1,885 2,253 2,423 2,655 2,897 3,124GDP (USD bn) 11.5 13.1 16.7 17.3 19.7 23.9 26.2 29.3 32.6 35.8Economic Growth (GDP, annual var. in %) 4.8 4.6 6.1 3.4 4.1 5.2 5.2 5.9 5.3 4.7Total Consumption (annual var. in %) 4.0 4.1 5.3 3.7 3.9 5.4 4.7 5.3 5.3 4.7Fixed Investment (annual var. in %) 9.3 12.6 18.7 2.9 7.5 23.7 6.2 6.5 7.8 8.0Unemployment (% of active population, eop) 8.0 7.7 6.7 7.9 6.5 8.0 7.8 7.8 7.4 7.2Fiscal Balance (% of GDP) 4.5 1.7 3.6 0.0 1.7 0.8 1.8 0.1 -0.1 0.0Public Debt (% of GDP) 55.2 40.5 37.2 40.0 38.5 34.7 33.4 33.1 31.4 30.7Monetary and Financial Sector Money (annual variation of M2 in %) 51.4 69.9 35.8 12.2 25.1 20.7 20.2 17.7 - -Inflation (CPI, annual variation in %, eop) 4.9 11.7 11.8 0.3 7.2 6.9 4.5 6.5 5.4 4.9Inflation (CPI, annual variation in %, aop) 4.3 8.7 14.0 3.3 2.5 9.9 4.5 5.7 5.9 5.2Prime Lending Rate (in %, eop) 11.8 14.4 13.8 9.1 10.4 10.8 10.6 11.4 10.9 10.7Exchange Rate (BOB per USD, eop) 7.94 7.58 7.00 7.02 7.01 6.91 7.01 6.91 6.96 6.97Exchange Rate (BOB per USD, aop) 7.94 7.82 7.24 7.02 7.02 7.00 6.99 6.96 6.93 6.96External Sector Current Account Balance (% of GDP) 11.3 11.5 11.9 4.3 3.9 0.3 8.6 4.2 3.8 2.6Current Account Balance (USD bn) 1.3 1.5 2.0 0.7 0.8 0.1 2.3 1.0 1.2 0.9Trade Balance (USD bn) 1.1 1.0 1.4 0.4 0.8 0.4 3.0 2.2 3.4 3.4Exports (USD bn) 3.9 4.5 6.5 5.0 6.4 8.4 11.2 11.5 13.2 13.9Imports (USD bn) 2.8 3.5 5.1 4.6 5.6 7.9 8.3 9.3 9.8 10.5Exports (annual variation in %) 38.8 15.1 46.4 -24.0 29.1 30.6 34.4 2.3 14.9 5.0Imports (annual variation in %) 20.5 22.4 47.5 -10.3 22.4 41.6 4.3 12.1 5.3 7.0International Reserves (USD bn) 4.0 6.1 8.6 10.1 11.2 13.2 15.3 17.3 16.1 15.6International Reserves (months of imports) 16.9 21.1 20.3 26.4 23.9 20.0 22.2 22.3 19.8 17.9External Debt (USD bn) 3.4 4.3 5.9 6.2 6.2 8.5 9.8 9.7 11.1 11.5External Debt (% of GDP) 29.8 32.7 35.3 35.8 31.5 35.4 37.2 33.0 34.1 32.2



April 2014

Fact Sheet

Bolivia in the Region


Bolivia0.5%

Brazil38.7%

Mexico21.8%

Argentina8.0%

Venezuela6.6%

Other24.5%

Bolivia1.9%

Brazil33.6%

Mexico19.9%

Colombia7.9%

Argentina7.0%

Other29.7%

U.S.A.11.1%

EU-279.5%

China13.1%

Other LatAm11.6%Brazil

18.5%

Argentina13.2%

Peru6.8%

Other16.1%

U.S.A.14.9%

EU-275.7%

Asia ex-Japan6.9%

Other LatAm10.2%

Brazil31.6%

Argentina17.9%

Peru5.0%

Other7.8%

Other1.6%


Mineral Fuels14.1%

Food7.8%

Other0.8%

Manufact. Products

5.2%

Ores & Metals31.2%

Mineral Fuels48.6%

Food14.2%

Trade Structure



Economic Structure


Exports

Exports

Imports

Imports

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

0

20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



• Small market size• Profound regional divisions• Widespread poverty

• Rich in natural resources • High illiteracy rates

• Entitled to participate in programs for poor countries from international organizations

Energy (2010)Primary Energy Production (trillion Btu): 639Primary Energy Consumption (trillion Btu): 233Electricity Generation (billion kW-h): 6.6Electricity Consumption (billion kW-h): 5.8Oil Supply (thousand bpd): 47.9Oil Consumption (thousand bpd): 54.4CO2 Emmissions (million metric tons): 13.3

Agency Rating OutlookMoody’s: Ba3 StableS&P: BB- StableFitch Ratings: BB- Stable


Transportation (2012) Airports: 865Railways (km): 3,652Roadways (km): 80,488Waterways (km): 10,000Chief Ports: Puerto Aguirre

Official name: Plurinational State of Bolivia

Capital (Administrative): La Paz (1.9 m)Capital (Judicial): Sucre (0.2 m)Other cities: Cochabamba (0.9 m)Area (km2): 1,098,581Population (million, 2013 est.): 11.0Population density (per km2, 2012): 10.0Population growth rate (%, 2012 est.): 1.7Life expectancy (years, 2012 est.): 67.9Illiteracy rate (%, 2001): 13.3Language: Spanish, Quechua and

AymaraMeasures: Metric systemTime: GMT-4

President: Juan Evo Morales AymaLast elections: 6 December 2009Next elections: 5 October 2014Central Bank President: Marcelo Zabalaga E.

FOCUSECONOMICS Ecuador


April 2014

EcuadorOutlook stableEcuador







-3.0

-2.5

-2.0

-1.5


2014 2015

3.8

4.0

4.2

4.4


2014 2015

-5

0

5

10

2000 2003 2006 2009 2012 2015

EcuadorLatin AmericaWorld

3.3

3.6

3.9

4.2

4.5


2014 2015

0

25

50

75

100

2000 2003 2006 2009 2012 2015

EcuadorLatin America

-4

-2

0

2

4

2000 2003 2006 2009 2012 2015

Ecuador

Latin America


Teresa KerstingEconomist

2007-09 2010-12 2013-15Population (million): 13.8 14.4 15.1GDP (USD bn): 58.4 76.8 96.8GDP per capita (USD): 4,229 5,320 6,419GDP growth (%): 3.0 5.5 3.9Fiscal Balance (% of GDP): -0.4 -0.7 -2.6Public Debt (% of GDP): 21.9 20.1 24.1Inflation (%): 5.3 4.4 3.0Current Account (% of GDP): 2.3 -1.0 -1.3External Debt (% of GDP): 27.8 19.7 20.0

President Rafael Correa announced that the country plans to issue approximately USD 700 million of sovereign debt this year. Ecuador has not sold global bonds in international capital markets since defaulting on USD 3.2 billion in debt in 2008. Even though this default was followed by a restructuring process, an estimated USD 289 million is still outstanding. The planned bond issue will help to diversify Ecuador’s funding sources; since the 2008 default Ecuador has relied heavily on China for financing. Ecuador seeks to use the newly raised funds for investment in infrastructure, particularly to enhance the country’s hydroelectric power generation capacity.

LatinFocus Consensus Forecast panelists see the economy growing 3.9% in 2014, which is unchanged from last month’s projection. For 2015, panelists expect the economy to expand 4.0%.

In March, annual inflation rose to 3.1% from February’s 2.9%. The

LatinFocus panel expects year-end inflation of 3.5% in 2014. In 2015, the panel expects inflation of 3.3%.



April 2014






Notes and sources

General: Long-term chart period from 2000 to 2015 unless otherwise stated. All data are from the National Statistical Institute (INEC, Instituto Nacional de Estadistica y Censos) and the Central Bank (BCE, Banco Central del Ecuador). See below for details. Forecasts based on LatinFocus Consensus Forecast. 1 GDP, annual variation in %. Source: BCE.2 Balance of non-financial public sector as % of GDP. Source: BCE.3 Inflation, annual variation of consumer price index (CPI) in % (eop).

Source: INEC.4 GDP, evolution of 2014 and 2015 forecasts during the last 18 months.5 Balance of non-financial public sector as % of GDP, evolution of 2014


months.7 Unemployment, % of active population. Source: INEC.8 Current account balance as % of GDP. Source: BCE.9 Trade balance, imports and exports, in USD bn. Source: BCE.10 Current account balance as % of GDP, evolution of 2014 and 2015


4

8

12

16

2000 2003 2006 2009 2012 2015

Ecuador

Latin America

-2

-1

0

1


2014 2015

-10

0

10

20

30

40

2000 2003 2006 2009 2012 2015


-6

-3

0

3

6

2000 2003 2006 2009 2012 2015

Ecuador

Latin America

Annual Data 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Real Sector Population (million) 13.4 13.6 13.8 14.0 14.2 14.4 14.6 14.9 15.1 15.3GDP per capita (USD) 3,491 3,749 4,474 4,464 4,774 5,398 5,787 6,077 6,402 6,776GDP (USD bn) 46.8 51.0 61.8 62.5 67.8 77.8 84.7 90.3 96.5 103.7Economic Growth (GDP, annual var. in %) 4.4 2.2 6.4 0.6 3.5 7.8 5.1 3.9 3.9 4.0Total Consumption (annual var. in %) 4.3 4.4 6.2 0.9 7.2 5.8 4.8 3.9 3.9 4.2Private Consumption (annual var. in %) 4.4 4.2 5.4 -1.0 7.7 5.9 4.3 - - -Government Consumption (annual var. in %) 3.8 5.7 11.1 11.6 4.4 4.8 7.6 - - -Fixed Investment (annual var. in %) 5.0 3.7 16.0 -3.6 10.2 16.1 11.0 5.9 6.2 6.0Industrial Production (annual var. in %) 10.6 17.7 0.4 -2.1 0.4 15.7 -2.0 4.9 6.2 4.3Unemployment (% of active population, aop) 10.1 8.8 6.9 8.5 7.6 6.0 4.9 4.7 5.1 5.3Fiscal Balance (% of GDP) 3.2 1.9 0.6 -3.6 -1.3 0.0 -0.9 -2.6 -2.8 -2.5Public Debt (% of GDP) 28.8 27.2 22.2 16.4 19.7 18.7 22.0 23.5 24.1 24.6Monetary and Financial Sector Inflation (CPI, annual variation in %, eop) 2.9 3.3 8.8 4.3 3.3 5.4 4.2 2.7 3.5 3.3Inflation (CPI, annual variation in %, aop) 3.3 2.3 8.4 5.2 3.6 4.5 5.1 2.7 3.0 3.491-120 Day Average Deposit Rate (%, eop) 4.9 5.64 5.14 5.44 4.28 4.53 4.53 4.53 4.41 4.41External Sector Current Account Balance (% of GDP) 3.7 3.7 2.8 0.5 -2.4 -0.3 -0.4 -1.4 -1.3 -1.2Current Account Balance (USD bn) 1.7 1.9 1.8 0.3 -1.6 -0.2 -0.3 -1.3 -1.3 -1.3Trade Balance (USD bn) 0.6 0.4 -0.2 -1.2 -3.1 -2.1 -1.7 -2.3 -2.0 -1.1Exports (USD bn) 12.7 14.3 18.5 13.9 17.5 22.3 23.8 25.0 26.6 29.5Imports (USD bn) 12.1 13.9 18.7 15.1 20.6 24.4 25.5 27.3 28.5 30.6Exports (annual var. in %) 26.0 12.5 29.3 -25.1 26.2 27.6 6.5 5.0 6.6 10.9Imports (annual var. in %) 17.8 14.7 34.5 -19.2 36.5 18.7 4.3 7.2 4.5 7.3International Reserves (USD bn) 2.0 3.5 4.5 3.8 2.6 3.0 2.5 4.4 2.9 3.0International Reserves (months of imports) 2.0 3.0 2.9 3.0 1.5 1.5 1.2 1.9 1.2 1.2External Debt (USD bn) 17.1 17.4 17.0 13.5 14.0 15.3 16.0 18.2 18.8 21.2External Debt (% of GDP) 36.5 34.2 27.5 21.7 20.6 19.7 18.9 20.1 19.5 20.4



April 2014

Fact Sheet

Ecuador in the Region

Population | %-share in Latin America GDP | %-share in Latin AmericaEcuador

1.3%

Brazil39.6%

Mexico20.9%

Argentina8.4%

Venezuela6.7%

Other22.9%

Ecuador2.7%

Brazil33.1%

Mexico19.6%

Colombia7.8%

Argentina6.9%

Other30.2%

U.S.A.26.9%

EU-2711.5%

Other Asia ex-Japan

7.9%

China11.2%

Other LatAm18.0%

Colombia8.7%

Panama6.6%

Other9.3%

U.S.A.44.7%

EU-2710.3%

Other LatAm16.2%

Chile8.4%

Peru8.4%

Other11.9%

Other2.7%


Mineral Fuels15.1%

Food8.8%

Other4.8% Manufact.

Products9.0%

Mineral Fuels54.3%

Food31.9%

Trade Structure



Economic Structure


Exports

Exports

Imports

Imports

-20

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

0

20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



• Substantial oil wealth

• Polarized political system• High potential for social unrest.

.

• High dependence on oil revenues

• Government pledges to maintain dollarization

• Dollarization provides safe calculation base

Energy (2010)Primary Energy Production (trillion Btu): 1,167Primary Energy Consumption (trillion Btu): 563Electricity Generation (billion kW-h): 17.1Electricity Consumption (billion kW-h): 14.7Oil Supply (thousand bpd): 487Oil Consumption (thousand bpd): 226CO2 Emmissions (million metric tons): 32.7

Agency Rating OutlookMoody’s: Caa1 StableS&P: B PositiveFitch Ratings: B Stable


Transportation (2012) Airports: 431Railways (km): 965Roadways (km): 43,670Waterways (km): 1,500Chief Ports: Guayaquil, Manta

Official name: Republic of EcuadorCapital: Quito (2.2m)Other cities: Guayaquil (2.6m)

Cuenca (0.3m)Area (km2): 283,561Population (million, 2013 est.): 14.9Population density (per km2, 2012 est.): 52.5Population growth rate (%, 2012 est.): 1.4Life expectancy (years, 2012 est.): 75.9Illiteracy rate (%, 2003): 7.5Language: Spanish, QuechuaMeasures: Metric systemTime: GMT-5

President: Rafael Correa DelgadoLast elections: 17 February 2013Next elections: 2017Central Bank President: Diego Martinez

FOCUSECONOMICS Paraguay


April 2014

ParaguayThe economy grew a robust 12.1% annually in the final quarter of 2013,

which was somewhat slower than the hefty 13.7% increase tallied in the third quarter. Healthy growth in agriculture and in industry supported the Q4 expansion; services, in contrast, recorded a slight deceleration. More recent data show that the economy is moving to a more sustainable growth trajectory. In January, economic activity rose 6.5% annually (December: +8.5% year-on-year).

LatinFocus Consensus Forecast participants see the economy expanding 4.8% this year, which is up 0.2 percentage points from last month’s estimate. For 2015, the panel expects growth of 4.3%.

In March, annual inflation rose to 6.1% from February’s 5.4%. Panelists expect inflation to close 2014 at 5.0%, which is down 0.2 percentage points from last month’s estimate. For 2015, the panel expects a year-end inflation stable at 5.0%.

Outlook improves


Dirina MançellariEconomist

Paraguay







-1.0

-0.8

-0.6

-0.4

-0.2

0.0


2014 2015

4.0

4.5

5.0

5.5

6.0


2014 2015

-5

0

5

10

15

2000 2003 2006 2009 2012 2015

ParaguayLatin AmericaWorld

4.5

4.7

4.9

5.1

5.3


2014 2015

0

5

10

15

2000 2003 2006 2009 2012 2015

ParaguayLatin America

-6

-3

0

3

2000 2003 2006 2009 2012 2015

Paraguay

Latin America

2007-09 2010-12 2013-15Population (million): 6.2 6.6 6.9GDP (USD bn): 16.0 23.1 30.7GDP per capita (USD): 2,571 3,518 4,436GDP growth (%): 2.5 5.2 7.5Fiscal Balance (% of GDP): 1.1 0.1 -1.1Public Debt (% of GDP): 18.3 13.7 14.1Inflation (%): 7.4 4.8 4.5Current Account (% of GDP): 3.2 -0.3 1.0External Debt (% of GDP): 23.0 22.0 22.9



April 2014


7 | Exchange Rate | PYG per USD

9 | PYG per USD | evolution of fcst



Notes and sources

General: Long-term chart period from 2000 to 2015 unless otherwise stated. All data are from Central Bank (BCP, Banco Central del Paraguay). See below for details. Forecasts based on LatinFocus Consensus Forecast. 1 GDP, annual variation in %.2 Balance of non-financial public sector as % of GDP.3 Inflation, annual variation of consumer price index (CPI) in % (eop).4 GDP, evolution of 2014 and 2015 forecasts during the last 18 months.5 Balance of non-financial public sector as % of GDP, evolution of 2014


months.7 Exchange rate, PYG per USD (eop).8 Current account balance as % of GDP.9 Exchange rate, evolution of 2014 and 2015 forecasts during the last 18



3,000

4,000

5,000

6,000

7,000

8,000

2000 2003 2006 2009 2012 2015

-4

-2

0

2


2014 2015

4,200

4,600

5,000

5,400


2014 2015

-5

0

5

10

15

2000 2003 2006 2009 2012 2015

ParaguayLatin America

Annual Data 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Real Sector Population (million) 6.0 6.1 6.2 6.3 6.5 6.6 6.7 6.8 6.9 7.0GDP per capita (USD) 1,772 2,248 2,958 2,506 3,085 3,804 3,664 4,351 4,321 4,637GDP (USD bn) 10.6 13.8 18.4 15.9 19.9 25.0 24.5 29.6 29.8 32.6Economic Growth (GDP, annual var. in %) 4.8 5.4 6.4 -4.0 13.1 4.3 -1.2 13.6 4.8 4.3Total Consumption (annual var. in %) 2.9 5.3 7.1 -1.0 13.4 5.5 3.2 8.7 6.0 4.6Fixed Investment (annual var. in %) 4.1 12.4 17.8 -6.9 21.7 11.0 -7.7 14.2 12.1 11.1Unemployment (% of active population, eop) 6.5 5.5 5.7 6.4 6.0 6.0 7.9 6.1 6.6 5.9Fiscal Balance (% of GDP) 0.4 0.9 2.3 0.1 1.2 0.7 -1.8 -1.9 -0.9 -0.4Public Debt (% of GDP) 26.5 20.4 15.4 19.0 15.4 11.5 14.1 14.2 14.0 14.0Monetary and Financial Sector Money (annual var. of M2 in %) 15.9 39.4 19.1 28.8 15.7 17.5 12.6 17.5 - -Inflation (CPI, annual var. in %, eop) 12.5 6.0 7.5 1.9 7.2 4.9 4.0 3.7 5.0 5.0Inflation (CPI, annual var. in %, aop) 9.6 8.1 10.2 2.6 4.6 8.3 3.7 2.7 4.9 5.0Certif. of Deposit Rate 180 Days (%, eop) 10.7 7.9 11.2 7.9 8.8 12.8 12.1 11.5 12.0 12.1Exchange Rate (PYG per USD, eop) 5,234 4,877 4,954 4,654 4,621 4,479 4,339 4,638 4,612 4,651Exchange Rate (PYG per USD, aop) 5,636 5,047 4,382 4,978 4,770 4,211 4,448 4,362 4,625 4,632External Sector Current Account Balance (% of GDP) 1.6 5.7 1.0 3.0 -0.3 0.4 -0.9 2.1 0.8 0.2Current Account Balance (USD bn) 0.2 0.8 0.2 0.5 -0.1 0.1 -0.2 0.6 0.2 0.1Trade Balance (USD bn) 1.1 1.5 1.0 1.1 0.9 0.9 0.6 1.7 1.4 0.9Exports (USD bn) 6.0 7.5 9.7 7.8 10.5 12.6 11.7 13.6 14.7 15.6Imports (USD bn) 4.9 6.0 8.7 6.6 9.6 11.8 11.1 11.9 13.3 14.7Exports (annual var. in %) 23.7 25.4 29.2 -20.3 35.0 20.7 -7.8 16.7 7.8 6.4Imports (annual var. in %) 32.0 23.6 44.0 -23.6 44.6 22.8 -5.8 7.6 11.1 10.5International Reserves (USD bn) 1.7 2.5 2.9 3.9 4.2 5.0 5.0 5.9 6.8 7.0International Reserves (months of imports) 4.2 4.9 4.0 7.0 5.2 5.1 5.4 5.9 6.1 5.7External Debt (USD bn) 3.1 3.2 3.9 3.9 4.5 4.7 6.0 6.5 7.0 7.4External Debt (% of GDP) 28.8 23.4 21.2 24.5 22.7 18.8 24.4 22.5 23.4 22.8



April 2014

Fact Sheet

Paraguay in the Region


Paraguay0.4%

Brazil39.6%

Mexico20.9%

Argentina8.4%

Venezuela6.7%

Other23.9%

Paraguay1.1%

Brazil33.7%

Mexico19.9%

Colombia7.9%

Argentina7.0%

Other30.4%

U.S.A.8.0% EU-27

6.5%Other Asia ex-Japan

5.2%

China27.7%

Other LatAm6.2%

Brazil23.7%

Argentina16.4%

Other6.3%

Russia9.7%

Other EU-27

8.6%

Germany5.9%

Other LatAm11.1%

Brazil39.3%

Argentina8.3%

Other17.1%

Other1.4%


Mineral Fuels13.7%

Food7.6%

Other2.8%

Manufact. Products

8.0%

Mineral Fuels30.4%

Food58.8%

Trade Structure



Economic Structure


Exports

Exports

Imports

Imports

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

0

20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



.

• Vulnerability to commodity price variation• Dependence on neighboring economies

• Commitment to structural reforms

• Favorable conditions for agriculture

Energy (2010)Primary Energy Production (trillion Btu): 522Primary Energy Consumption (trillion Btu): 438Electricity Generation (billion kW-h): 53.5Electricity Consumption (billion kW-h): 6.8Oil Consumption (thousand bpd): 31.2CO2 Emmissions (million metric tons): 4.4

Agency Rating OutlookMoody’s: Ba2 PositiveS&P: BB- StableFitch Ratings: BB- Positive


Transportation (2012) Airports: 800Railways (km): 36Roadways (km): 29,500Waterways (km): 3,100Chief Ports: Asuncion

Official name: Republic of ParaguayCapital: Asuncion (0.6m)Other cities: Ciudad del Este (0.2m)

Pedro Juan Caballero (0.1m)Area (km2): 406,752Population (million, 2013 est.): 6.8Population density (per km2, 2012 est.): 16.7Population growth rate (%, 2012 est.): 1.3Life expectancy (years, 2012 est.): 76.4Illiteracy rate (%, 2003): 6.0Language: Spanish, GuaraniMeasures: Metric systemTime: GMT-4

President: Horacio CartesLast elections: 21 April 2013Next elections: 2018Central Bank President: Jorge Corvalan Mendoza

FOCUSECONOMICS Uruguay


April 2014

REAL SECTOR | Economy accelerates in Q4, pushes up 2013 growth In Q4, GDP grew 4.6% over the same quarter last year. The reading marked an acceleration compared to the revised 3.0% growth rate registered in Q3 (previously reported: +3.3% year-on-year). As a result, the economy expanded a healthy 4.4% in the full year 2013, which was up from the 3.7% rise tallied in 2012.

The economy continued to benefit from buoyant domestic demand, which was especially due to fixed investment. Conversely, conditions in the external sector continued to worsen. Total consumption expanded 4.8% in Q4, which was down from the 5.3% rise recorded in Q3. Private consumption expanded 5.0% in Q4 (Q3 2013: +5.6% yoy). Government spending improved in the fourth quarter; it expanded 3.0%, which was a tad above the 2.9% rise seen in the previous quarter. Fixed investment registered the strongest improvement, as it expanded 1.9% in Q4, which was up from the 0.2% rise seen in Q3.

Exports of goods and services deteriorated from a 2.0% expansion in Q3 to a 0.8% contraction in Q4. Imports, on the other hand, accelerated to a 3.8% expansion (Q3: +2.0% yoy).

A quarter-on-quarter comparison corroborates the improvement suggested by the annual data; the economy expanded 2.0% over the previous quarter in seasonally-adjusted terms, which contrasted the revised 0.9% contraction recorded in Q3 (previously reported -0.7% quarter-on-quarter).

GDP expanded 4.6% in Q4 2013, which was up from the 3.0% rise seen in the previous quarter. The economy benefited primarily from strong growth in domestic demand, whereas the external sector deteriorated. As a consequence, the economy grew a healthy 4.4% in the full year 2013, which was up from the 3.7% tallied in 2012. However, in February, industrial production fell 3.1% annually, which was the second consecutive contraction (January: -4.3% year-on-year).

LatinFocus Consensus Forecast participants expect GDP to expand 3.4% this year, which is up 0.1 percentage points over the previous month’s projection. In 2015, panelists see economic growth at 3.6%.

Annual inflation inched down from 9.8% in February to 9.7% in March. Despite March’s timid drop, inflation is still the main economic policy concern and the Central Bank reiterated its contractive stance at its 8 April Monetary Policy meeting. The panel expects inflation to end this year at 8.6%. For 2015, the panel expects inflation to moderate to 7.6%.

Outlook improves


Enrique JorgeEconomist

2010-12 2013-15 2016-18Population (million): 3.4 3.4 3.4GDP (USD bn): 45.7 57.1 69.1GDP per capita (USD): 13,551 16,784 20,133GDP growth (%): 6.5 3.8 3.8Fiscal Balance (% of GDP): -1.3 -2.0 -1.7Public Debt (% of GDP): 60.4 57.1 52.1Inflation (%): 7.6 8.7 6.7Current Account (% of GDP): -3.4 -4.4 -3.6External Debt (% of GDP): 42.6 40.4 29.8

Uruguay

Uruguay


Note: Year-on-year changes of GDP in %.Source: Uruguay Central Bank (BCU) and LatinFocus Consensus Forecast.

0.0

3.0

6.0

9.0

12.0

Q1 2010 Q1 2011 Q1 2012 Q1 2013 Q1 2014

%



April 2014

FocusEconomics Consensus Forecast panelists expect GDP to grow 3.4% in 2014, which is up 0.1 percentage points from last month’s forecast. For 2015, the panel sees economic output expanding 3.6%.

REAL SECTOR | Industrial production contracts in FebruaryIn February, industrial production contracted 3.1% over the same month last year, which was above the 4.3% drop recorded in January. The contraction was mainly driven by a drop in production of food and beverages, oil and coal, and in paper products.

Excluding the contribution of the La Teja refinery—the country’s only oil refinery and a key contributor to overall production—industrial output contracted 1.8% annually in February, which was up from the 6.0% contraction recorded in January. Meanwhile, annual average growth in industrial production dropped from 1.9% in January to 1.2% in February, which is the lowest level since September 2012.

LatinFocus Consensus Forecast panelists expect industrial production to increase 4.4% this year, which is down 1.2 percentage points from last month’s forecast. For 2015, the panel sees industrial output growth at 4.5%.

MONETARY SECTOR | Government cuts VAT, inflation inches down in MarchIn March, consumer prices rose 0.58% over the previous month, which was below the 1.66% increase recorded in February. The print exceeded market expectations of a 0.35% increase. According to the Statistical Institute, the monthly rise in consumer prices reflected that a sharp drop in prices for communications was more than offset by an increase in prices for education, food and non-alcoholic beverages as well as for transport.

Annual inflation inched down to 9.7% in March from the 9.8% tallied in February, which had marked the highest rate since August 2004. Despite the moderation, inflation remains well above the Central Bank’s target range of 4.0%–6.0%.

On 11 March, Finance Minister Mario Bergara unveiled a legislative initiative to fight supply-side inflation. The measure introduced value-added tax (VAT) exemptions on Antel and UTE tariffs, the state-owned telecommunications and energy companies, respectively. The reductions were retroactively effective since 1 March. Moreover, on 14 March, Bergara reached an agreement with retailers in order to hold prices of basic goods for 60 days.

Most analysts affirm that the fiscal costs of the VAT cuts are estimated around USD 100 million (approximately 0.2% of GDP). Moreover, analysts expect that the initiative is likely to reduce inflation temporarily. However, analysts also agree that the effects will prove transitory and will not address the main causes of Uruguay’s structural inflation problem, which is related to wage indexation.

LatinFocus Consensus Forecast participants expect inflation to drop to 8.6% by the end of 2014, which is unchanged from last month’s projection. For 2015, panelists see inflation at 7.6%.


Note: Annual and monthly variation of consumer price index in %. Expectations of monthly variations of consumer price index in %.Source: National Statistical Institute (INE) and Uruguay Central Bank (BCU).

7.0

8.0

9.0

10.0

11.0

-1.0

0.0

1.0

2.0

3.0




Month-on-month expectations (left scale)

%%


Note: Year-on-year changes and annual average variation of industrial production in %.Source: National Statistical Institute (INE) and FocusEconomics calculations.

-10

0

10

20

30


Year-on-year

Annual average

%



April 2014


Annual Data 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Real SectorPopulation (million) 3.3 3.4 3.4 3.4 3.4 3.4 3.4 3.4 3.4 3.5GDP per capita (USD) 9,268 11,618 13,951 15,084 16,509 16,562 17,279 18,492 20,116 21,791GDP (USD bn) 31.0 39.0 47.0 51.0 56.0 56.3 59.0 63.3 69.1 75.1Economic Growth (GDP, annual var. in %) 2.4 8.4 7.3 3.7 4.4 3.4 3.6 3.7 3.8 3.9Private Consumption (annual var. in %) -1.5 12.8 9.8 5.5 5.3 3.8 3.8 4.2 4.4 4.4Fixed Investment (annual var. in %) -4.7 13.6 6.4 19.2 6.2 3.5 4.3 4.9 5.2 5.3Industrial Production (annual var. in %) -4.0 3.5 0.5 5.8 4.1 4.4 4.5 4.6 4.7 4.7Unemployment (% of active population, aop) 7.8 7.0 6.3 6.3 6.5 6.9 6.8 6.7 6.6 6.5Fiscal Balance (% of GDP) -1.5 -1.2 -0.6 -2.0 -1.6 -2.4 -2.0 -1.9 -1.8 -1.4Public Debt (% of GDP) 66.1 61.6 60.0 59.6 59.4 57.5 54.5 53.2 52.0 51.3Monetary and Financial Sector Money (annual variation of M1+ in %) 15.2 30.0 20.8 11.2 12.7 10.4 9.8 9.2 8.6 8.0Inflation (CPI, annual var. in %, eop) 5.9 6.9 8.6 7.5 8.5 8.6 7.6 6.7 6.4 6.3Inflation (CPI, annual var. in %, aop) 7.1 6.7 8.1 8.1 8.6 9.1 8.3 7.2 6.5 6.330-day Deposit Rate (%, aop) 5.81 4.57 5.80 6.85 7.35 8.05 7.90 7.50 7.25 7.00Exchange Rate (UYU per USD, eop) 19.5 19.9 19.9 19.2 21.1 23.7 25.0 25.3 25.6 26.0Exchange Rate (UYU per USD, aop) 22.6 19.5 19.6 19.5 19.1 22.8 24.4 25.1 25.4 25.8External Sector Current Account Balance (% of GDP) -1.2 -1.9 -2.9 -5.3 -5.6 -3.8 -3.8 -3.7 -3.6 -3.4Current Account Balance (USD bn) -0.4 -0.7 -1.4 -2.7 -3.1 -2.1 -2.2 -2.3 -2.5 -2.6Trade Balance (USD bn) -0.5 -0.5 -1.4 -2.4 -1.3 -1.4 -1.4 -1.7 -1.0 -0.3Exports (USD bn) 6.4 8.0 9.3 9.9 10.3 11.1 11.7 12.6 13.7 15.0Imports (USD bn) 6.9 8.6 10.7 12.3 11.6 13.0 13.6 14.1 14.7 15.3Exports (annual var. in %) -9.9 25.6 15.5 6.9 4.0 7.8 5.3 8.0 8.4 9.3Imports (annual var. in %) -21.7 24.1 25.1 14.7 -5.6 12.1 4.4 4.2 4.0 3.8International Reserves (USD bn) 8.0 7.7 10.3 13.6 16.3 16.5 17.0 17.1 17.2 17.4International Reserves (months of imports) 13.9 10.8 11.5 13.3 16.9 15.3 15.1 14.5 14.0 13.7External Debt (USD bn) 18.0 18.4 18.3 21.1 22.9 23.5 22.8 21.0 20.5 20.0External Debt (% of GDP) 58.0 47.3 39.0 41.4 40.9 41.7 38.6 33.2 29.7 26.6 Quarterly Data Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q4 15Economic Growth (GDP, annual var. in %) 3.0 4.6 2.9 3.3 3.5 3.7 3.7 3.7 3.6 3.5Inflation (CPI, annual var. in %, eop) 9.0 8.5 9.7 9.3 8.4 8.6 7.6 7.7 7.6 7.6Exchange Rate (UYU per USD, eop) 21.9 21.1 22.7 22.6 23.2 23.7 24.1 24.6 25.0 25.0 Monthly Data Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14Industrial Production (annual var. in %) -1.2 -0.1 0.5 -3.6 16.1 1.9 1.7 -4.3 -3.1 -Unemployment (% of active population, aop) 6.5 6.9 6.0 6.0 6.4 6.4 6.0 6.7 7.0 -Inflation (CPI, mom variation in %) 0.43 0.77 1.04 1.36 0.82 0.20 -0.72 2.44 1.66 0.58Inflation (CPI, annual var. in %) 8.2 8.8 8.9 9.0 8.7 8.5 8.5 9.1 9.8 9.7Exchange Rate (UYU per USD, eop) 20.4 21.3 22.4 21.9 21.5 21.2 21.1 22.2 22.5 22.7



April 2014

Real Sector | Gross Domestic Product and Fiscal Balance

1 | Real GDP | 2000-2018 | var. in %




2 | Real GDP | Q1 11-Q4 15 | var. in % Economic Growth and Fiscal Balance



8 | Fiscal Balance | evolution of fcstNotes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All real sector data are from the from the National Statistical Institute (INE, Instituto Nacional de Estadistica) and the Central Bank (BCU, Banco Central de Uruguay). See below for details. Forecasts based on LatinFocus Consensus Forecast. 1 GDP, annual variation in %. Source: BCU.2 Quarterly GDP (not seasonally adjusted), year-on-year variation in %.

Source: BCU.3 GDP, evolution of 2014 forecasts during the last 18 months.4 GDP, evolution of 2015 forecasts during the last 18 months.5 Unemployment, % of active population. Source: INE.6 Balance of non-financial public sector as % of GDP. Source: BCU.7 Unemployment, evolution of 2014 and 2015 forecasts during the last 18

months.8 Balance of non-financial public sector as % of GDP, evolution of 2014

and 2015 forecasts during the last 18 months.

Individual Forecasts 2014 2015 2014 2015BBVA Research 3.5 3.6 -2.6 -2.3BofA Merrill Lynch 4.0 4.0 - -Capital Economics 3.3 3.3 - -cinve 2.8 3.0 - -EIU 3.0 3.4 -2.5 -1.9Equipos Consultores 2.6 - -2.7 -HSBC 3.6 3.8 -2.1 -1.7Iecon - UdelaR 3.5 4.0 -2.0 -1.8JPMorgan 3.8 4.0 -2.4 -Oikos 3.9 4.0 -2.3 -1.9República AFAP 3.2 - - -Santander 3.0 2.9 -3.0 -2.5SummaryMinimum 2.6 2.9 -3.0 -2.5Maximum 4.0 4.0 -2.0 -1.7Median 3.4 3.7 -2.5 -1.9Consensus 3.4 3.6 -2.4 -2.0History30 days ago 3.3 3.7 -2.3 -2.160 days ago 3.5 3.8 -2.2 -1.990 days ago 3.6 3.8 -2.2 -2.2Additional ForecastsWorld Bank (Jan. 2014) 4.1 4.3 - -IMF (Apr. 2014) 2.8 3.0 - -CEPAL (Dec. 2013) 3.5 - - -

Real GDP Fiscal Balancevariation in % % of GDP

-10

-5

0

5

10

2000 2005 2010 2015

UruguayLatin AmericaWorld

5

10

15

20

2000 2005 2010 2015

UruguayLatin America

0

2

4

6

8

10

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15

UruguayLatin AmericaWorld

2

3

4

5



2

3

4

5

6



6.2

6.4

6.6

6.8

7.0


2014 2015-2.5

-2.0

-1.5

-1.0


2014 2015

-6

-4

-2

0

2000 2005 2010 2015

Uruguay

Latin America



April 2014

Monetary and External Sector | Inflation and Exchange Rate

9 | Inflation | 2000 - 2018 | in %


13 | Exchange Rate | UYU per USD

15 | UYU per USD | evol. of fcst

10 | Inflation | Q1 11-Q4 15 | in % Consumer Price Index and Exchange Rate




Notes and sources

General: Long-term chart period from 2000 to 2018 unless otherwise stated. All monetary and external sector data are from the from the National Statistical Institute (INE, Instituto Nacional de Estadistica), the Central Bank (BCU, Banco Central de Uruguay) and Thomson Reuters. See below for details. Forecasts based on LatinFocus Consensus Forecast. 9 Inflation, annual variation of consumer price index (CPI) in % (eop).

Source: INE.10 Quarterly inflation, annual variation of consumer price index (CPI) in %

(eop). Source: INE.11 Inflation, evolution of 2014 forecasts during the last 18 months.12 Inflation, evolution of 2015 forecasts during the last 18 months.13 Exchange rate, UYU per USD (eop). Source: Thomson Reuters.14 Current account balance as % of GDP. Source: BCU.15 Exchange rate, evolution of 2014 and 2015 forecasts during the last 18



10

15

20

25

30

2000 2005 2010 2015

-4

-3

-2

-1


2014 2015

20

22

24

26


2014 2015

-6

-4

-2

0

2

4

2000 2005 2010 2015


0

10

20

30

2000 2005 2010 2015


5

7

9

11

Q1 11 Q1 12 Q1 13 Q1 14 Q1 15


5

6

7

8

9



5

6

7

8

9



Individual Forecasts 2014 2015 2014 2015BBVA Research 8.2 6.0 23.2 25.9BofA Merrill Lynch - - 23.5 -Capital Economics 8.0 7.0 - -cinve 8.7 8.3 - -EIU 8.6 7.0 23.6 24.6Equipos Consultores 8.9 - 24.5 -HSBC 8.5 8.0 22.8 23.5Iecon - UdelaR 8.7 8.0 24.0 25.5JPMorgan - - - -Oikos 9.0 8.0 23.5 24.2República AFAP 8.9 8.1 - -Santander 8.7 8.3 24.4 26.5SummaryMinimum 8.0 6.0 22.8 23.5Maximum 9.0 8.3 24.5 26.5Median 8.7 8.0 23.5 25.0Consensus 8.6 7.6 23.7 25.0History30 days ago 8.6 7.5 23.7 24.960 days ago 8.1 7.5 23.2 24.690 days ago 8.0 7.3 22.8 24.6Additional ForecastsIMF (Apr. 2014) 8.5 7.6 - -

CPI Exchange Ratevariation in % UYU per USD



April 2014

Uruguay in the Region


Fact Sheet

Uruguay1.0%

Brazil38.7%

Mexico21.8%

Argentina8.0%

Venezuela6.6%

Other24.0%

Uruguay0.6%

Brazil33.6%

Mexico19.9%

Colombia7.9%

Argentina7.0%

Other31.0%

U.S.A.9.9%

EU-2715.3%

Other Asia ex-Japan

5.3%

China17.9%

Other LatAm8.2%

Brazil16.2%

Argentina14.0%

Other13.1%

EU-2714.8%

China18.2%

Other LatAm21.0%

Brazil18.9%

Other27.1%

Other13.2%


Mineral Fuels22.4%

Other2.2%


Agric.

Raw Mat.8.3%

Food63.5%

Trade Structure



Economic Structure


Exports

Exports Imports

-20

0

20

40

60

80

1002004-06 2007-09 2010-12

Net Exports

Investment


PrivateConsumption

0

20

40

60

80

1002004-06 2007-09 2010-12

Agriculture

Manufacturing

Other Industry

Services

General Data


Political Data



• Small domestic market

.

• Privatization and deregulation lagging• Dependence on neighboring economies

• Commited to free market economic policy• Strong natural resource endowment

Energy (2010)Primary Energy Production (trillion Btu): 93.0Primary Energy Consumption (trillion Btu): 212Electricity Generation (billion kW-h): 10.7Electricity Consumption (billion kW-h): 9.1Oil Supply (thousand bpd): 1.1Oil Consumption (thousand bpd): 55.9CO2 Emmissions (million metric tons): 8.5

Agency Rating OutlookMoody’s: Baa3 PositiveS&P: BBB- StableFitch Ratings: BBB- Stable


Transportation (2012) Airports: 94Railways (km): 1,641Roadways (km): 77,732Waterways (km): 1,600Chief Ports: Montevideo

Official name: Oriental Republic of Uruguay

Capital: Montevideo (1.3 m)Other cities: Canelones (0.4 m)

Maldonado (0.1 m)Area (km2): 176,215Population (million, 2013 est.): 3.4Population density (per km2, 2012): 19.2Population growth rate (%, 2012 est.): 0.2Life expectancy (years, 2012 est.): 76.4Illiteracy rate (%, 2004): 2.0Language: SpanishMeasures: Metric systemTime: GMT-3

President: Jose Mujica CordanoLast elections: 29 November 2009Next elections: 26 October 2014Central Bank President: Alberto Graña Imports

FOCUSECONOMICS


April 2014

Notes and Statements

PUBLICATION NOTE

Consensus forecasts are mean averages of projections of economic forecasters surveyed by FocusEconomics for our monthly publication. Quarterly averages may not correspond to the annual figures due to different forecast panels.

The GDP-weighted averages for the regional aggregates refer to economies surveyed by FocusEconomics on a monthly basis, and include the following countries:

Latin America (23 countries): Argentina, Belize, Bolivia, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Haiti, Honduras, Jamaica, Mexico, Nicaragua, Panama, Puerto Rico, Paraguay, Peru, Trinidad and Tobago, Uruguay and Venezuela.Andean Community (4 countries): Bolivia, Colombia, Ecuador and Peru.Central America and Caribbean (12 countries): Belize, Costa Rica, Dominican Republic, El Salvador, Guatemala, Haiti, Honduras, Nicaragua and Panama, Puerto Rico and Trinidad and Tobago.Mercosur (5 countries): Argentina, Brazil, Paraguay, Uruguay and Venezuela.

Weights are based on market exchange rates and reflect the latest forecasts on GDP growth, inflation and exchange rates.

COPYRIGHT NOTE

© Copyright 2014 FocusEconomics S.L. Duplication, reproduction, transmission, publication or redistribution in any form or by any means electronic, mechanical, or otherwise without prior written consent of FocusEconomics S.L. is strictly prohibited. Please cite source when quoting. All rights reserved under International Copyright Conventions.

The LatinFocus Consensus Forecast is a monthly publication of FocusEconomics. Communications to the Editor or FocusEconomics in general should be addressed as follows:

FocusEconomics S.L.Gran Via 657E-08010 BarcelonaSpaintel: +34 932 651 040fax: +34 932 650 804e-mail: [email protected] web: http://www.focus-economics.com

DISCLOSURE STATEMENT

The LatinFocus Consensus Forecast (“Forecast”) is based on information obtained from sources believed to be reliable. FocusEconomics and the participating panelists (“Information Providers”) do not guarantee that the information supplied in the Forecast is accurate, complete or timely. The Information Providers do not make any warranties with regard to the results obtained from the Forecast. The Information Providers are not responsible for any errors or omissions, or for any injuries or damages resulting from the use of this information, including incidental and consequential damages. Recipients should not regard the Forecast as a substitute for the exercise of their own judgement. The recommendations made in the Forecast may be unsuitable for investors depending on their specific investment objectives and financial position. The Forecast has been prepared solely for informational purposes and is not a solicitation of any transaction or an offer to enter into any transaction. Any opinions expressed in this report are subject to change without notice and the Information Providers are under no obligation to update the information contained herein.

Notes

FocusEconomics | Gran Via 657, 08010, Barcelona, Spain | +34 932 651 040 | [email protected]

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