Another lost decade!Brazil, Mexico back in recession in 2022?

2022-05-02 0 By

Wang Ye said financial news: all roads lead to the same destination!Two years after entering the pandemic, Latin America’s two largest economies, Brazil and Mexico, find themselves in a similar and unenviable position: back in recession.Mexico’s GDP grew by 0.1% in the fourth quarter of 2021, the latest figures show, after contracting by 0.4% in the previous three quarters.In addition, Brazil’s $1.6 trillion economy was the only large one in the region in 2021, but the economy slipped into recession in the second quarter of 2021 and is expected to be flat throughout 2021, as the chart below shows:Adriana Dupita, an analyst at Bloomberg Economics, commented: “Both [Mexico and Brazil] are now facing synchronised recessions, driven by a combination of supply-chain problems, local interest rate hikes, policy uncertainty and their own structural problems.”It is also striking that both economies rely on drivers of growth that are exactly the opposite of what politicians promise.Brazil’s president, Jair Bolsonaro, hired Paulo Gudez, an economist from the University of Chicago school of thought known for its opposition to public spending, to run things.He presided over a massive fiscal splurge, breaking budget rules that were supposed to restrain spending.And Mexico’s series – lopez obrador came to power after the commitment to reduce dependence on large its northern neighbor (USA), but the biggest boost the Mexican economy over the past few years the achievements is the generous revenues in the outbreak indirectly as a result, this led to a surge in demand, exports to Mexico and stimulation check the wave of immigrants to the home of the remittance.In response, Goldman Sachs Group Inc.Alberto Ramos, the chief Latin American economist, said it was “worrying” that Mexico had come so far only on the back of US policies.Even Citigroup Inc.”Latin America needs long-term and inclusive growth,” says Ernesto Revilla, head of the Latin American economy and former chief economist at Mexico’s Finance ministry. “Another ‘lost decade’ is not something we write in books.But there are risks.”What do you think about that?What do you think will happen to the Mexican and Brazilian economies next?Note: this article is compiled by wang Ye said finance, if you need to reprint please pay attention to the account in advance, private chat contact Wang Ye himself, after obtaining authorization to reprint, reprint please original reprint, shall not carry out any graphic transformation atlas, video and other forms of reprint, infringement will be prosecuted!In addition, the views in this article are personal views, only used for learning, exchange and discussion, do not constitute investment advice!If there are omissions, mistakes, welcome criticism and correction!Thank you for reading this article. Please leave a comment. If you like this article, you can directly like it and recommend it down ↓↓↓.