Uriel Loredo

September 8–12 

U.S. inflation came in above expectations, but declines in producer prices and weak employment data reinforced expectations of a rate cut. In Latin America, Mexico and Brazil outlined new fiscal plans, while Europe and China continue to show trade fragility. 

• United States: Inflation rose 0.4% in August, but the PPI fell 0.1%, reinforcing expectations of a rate cut. Together with weak employment data, this has fueled anticipation of the first cut since last year. 

• Europe: German exports fell 0.6% month-over-month, including an 8% drop to the U.S. The ECB kept rates unchanged, while France faces new political challenges with the appointment of a new prime minister. 

• China: Exports rose 4.4% year-over-year, below the 5% forecast. Inflation fell -0.4% YoY, while producer prices dropped 2.9% YoY, deepening the disinflationary trend. 

• Japan: Q2 GDP was revised upward to 2.2% annualized, driven by stronger private consumption and inventory buildup. 

• Brazil: Inflation eased to 5.13% YoY. While headline prices declined 0.11% MoM, services remain under pressure. 

• Mexico: The 2026 economic package projects a lower deficit (4.16% of GDP) and growth between 1.8% and 2.8%. Pemex will receive $14 billion in support, and new tariffs on Chinese vehicles are under consideration. 

“Time is your friend; impulse is your enemy.” — John C. Bogle 

Key Events: 

• U.S. Retail Sales — 09/16 
• U.S. Monetary Policy Announcement — 09/18 

Monitor

Week: September 2-5  

Markets remain attentive to mixed signals on inflation, trade, and monetary policy. 

In a week marked by diverging economic data and monetary policy expectations, here are the key points investors closely followed: 

United States 

• Manufacturing contracted for the sixth consecutive month in August. 
• Fed Governor Christopher Waller expressed support for starting a rate-cut cycle in September, leaving room for further adjustments. 
• Markets are pricing in a 96% probability of a 25 bps cut at the September 18 meeting. 
• Employment slowed in August, with the unemployment rate edging up to 4.3% 

Europe 

• Manufacturing expanded in August for the first time since 2022. 
• Inflation ticked up slightly to 2.1% YoY, driven by unprocessed food and a smaller decline in energy costs. 

Asia 

• Japan’s manufacturing fell again in August due to weaker foreign demand and U.S. tariffs. The BoJ indicated hikes may continue, though without urgency. 
• China, the manufacturing PMI saw its fastest growth in five months, and services posted their best performance in over a year, supported by domestic consumption. 

Latin America  

• Brazil, the government completed its third external debt issuance of the year, including 30Y bonds at 7.5% and 5Y bonds at 5.2%. 
• Mexico, remittances fell 4.7% YoY in July, though they remain at historically high levels. Banxico raised GDP forecasts to 0.6% for 2025. Pemex launched a bond buyback of up to USD 9.9B, with a deadline of September 30. 

“Our favorite holding period is forever.” — Warren Buffett 

Upcoming Key events:  

• China export data — 09/08 
• U.S. inflation data — 09/11 

Monitor

Week: August 25–29 

Global markets reacted this week to renewed trade tensions, macroeconomic revisions, and political moves that increased uncertainty over the global economic outlook. In the U.S., stronger-than-expected data was overshadowed by political interference. In Europe, confidence indicators showed a fragmented recovery. Asia remains cautious amid weak industrial growth, while Latin America faces rising trade and political pressures. 

United States: 
• GDP for Q2 2025 was revised up to 3.3% annualized, supported by a 1.6% rise in consumer spending. 
• Jobless claims declined to 229,000. 
• President Trump dismissed Fed Governor Lisa Cook over alleged mortgage fraud, raising concerns about central bank independence. 
• A 50% tariff on Indian exports went into effect, impacting $48.2 billion in trade. 

Europe: 
• Germany’s IFO business confidence index reached a 15-year high. 
• However, GfK consumer confidence declined for the third straight month. 
• The EU proposed lifting tariffs on U.S. industrial goods, including retroactive cuts on automobiles. 
• UK producer prices rose 1.9% YoY in June, the highest in two years. 

Asia: 
• Japan downgraded its corporate earnings outlook due to U.S. trade policies. 
• In China, industrial profits dropped 1.5% in July, despite a trade truce with the U.S. 

Argentina: 
• The Central Bank raised the reserve requirement by 3.5 percentage points to 48.5% amid electoral tensions and corruption allegations. 

Brazil: 
• Created 129,775 formal jobs in July, the lowest monthly figure since March. 
• Finance Minister Haddad may challenge U.S. tariffs in court. 

Mexico: 
• Steel exports to the U.S. dropped 16.6% YoY in H1. 
• New tariffs on Chinese imports planned in the 2026 budget proposal. 
• Mexico and Brazil signed agreements on biofuels and competitiveness during VP Alckmin’s visit. 

“Know what you own, and know why you own it.” — Peter Lynch 

Upcoming Key Events: 

• U.S.: ISM Manufacturing Index – September 2 
• U.S.: Employment report – September 5 

Monitor

Week of August 18–22 

The third week of August was marked by a modest flow of economic data, yet key signals began to shape the global monetary outlook. In the U.S., housing starts and building permits posted moderate gains, while the Fed minutes revealed ongoing concerns about inflation. Powell’s latest remarks hinted that conditions may soon warrant a policy rate adjustment. 

In Europe, inflation in the UK rose to its highest level in 18 months, even as Germany confirmed a contraction in its second-quarter GDP. Despite this, analysts expect the Bank of England to consider additional rate cuts before year-end. Meanwhile, Asia showed signs of softness: both China and Japan reported a decline in exports, and China’s youth unemployment remains elevated. 

In Latin America, institutional developments made headlines. Petrobras’ CEO resigned, while Pemex’s credit rating was placed under review following the release of its 2025–2035 strategic plan. As markets enter a more uncertain phase, attention now turns to Jackson Hole, where central bank narratives may set the tone for the remainder of the year. 

• United States: Fed minutes highlight inflation concerns and labor weakness. S&P affirms ‘AA+’ rating. Housing starts up 2.8%, permits up 0.5%. Powell suggests current conditions could justify a rate adjustment. 

• Europe: UK may cut rates again, despite 3.8% inflation. Germany contracts. EU limits tariffs on exports to the U.S. 

• Japan: Exports drop 2.6% YoY; exports to the U.S. fall 10.1%. 

• China: Youth unemployment rises to 17.8%. Benchmark rates unchanged. 

• Brazil: Petrobras CEO resigns. 

• Mexico: Moody’s places Pemex under review. Fitch sees neutral impact. Inflation surprises to the downside; Q2 GDP slightly revised. 

“Don’t bottom fish.” — Peter Lynch 

KEY EVENTS 

• U.S.: Consumer Confidence → August 25 
• U.S.: Q2 GDP Release → August 28 

Monitor

Week of August 11–15 

This week, global markets reacted to a series of mixed developments. In the U.S., President Trump extended by 90 days the implementation of new tariffs on China, keeping the current 30% and 10% levels unchanged. July’s inflation came in slightly below expectations at 2.7%, driven by housing costs. 

In Europe, German investor confidence dropped sharply amid disappointment over EU-U.S. trade talks and weak economic performance. Analysts expect the ECB to hold rates steady at 2%, marking the end of its current easing cycle. 

In Asia, Japan’s producer inflation decelerated for a fourth month, while China posted soft data in retail sales and industrial production. In Latin America, Brazil announced a $5 billion support plan for local businesses, while Mexico highlighted a record trade deficit with China and a historic drop in poverty levels. 

“Never invest in any idea you can’t illustrate with a crayon.” — Peter Lynch 

KEY EVENTS NEXT WEEK 

• U.S. Housing Starts and Building Permits → August 19 
• FOMC Meeting Minutes → August 20 

Monitor

Week of August 4–8 

The month kicks off with trade tensions and monetary policy adjustments. 

The first week of August brings key monetary policy decisions, new tariffs, and mixed signals from major economies. Here’s a country-by-country recap: 

• United States: The ISM services index stalled in July, showing higher inflation and weaker employment. President Trump announced new tariffs: an additional 25% on India for purchasing Russian oil, and 100% on semiconductor imports, with exemptions for companies investing in domestic manufacturing. 

• Europe: The Bank of England cut its benchmark rate from 4.25% to 4%, though 4 of its 9 committee members voted to keep rates unchanged. The PMI showed a slight expansion in the business environment in July. 

• China: The services sector grew at its fastest pace in 14 months, driven by domestic demand. Exports jumped 7.2% year-over-year in July, beating expectations. 

• Brazil: The finance minister will meet with his U.S. counterpart as the country seeks alternatives to the recently imposed 50% U.S. tariff. 

• Mexico: Banxico cut the policy rate by 25 bps to 7.75%, slowing the pace compared with previous 50 bps cuts. Annual inflation eased to 3.51% in July. The government unveiled Pemex’s 2025–2035 Strategic Plan to make the oil company more efficient and profitable. 

“The stock market is filled with individuals who know the price of everything, but the value of nothing.”
— Phillip Fisher 

KEY UPCOMING EVENTS 

• U.S. inflation data release – 08/12 
• Speeches by various Fed members – 08/13 

Monitor 

Week of July 28 to August 1 

Tariff truces, steady rates, and solid growth in the U.S. and Mexico 

Global markets start the week with mixed but constructive signals. Below is a brief country-by-country summary: 

• United States: The Fed kept rates unchanged for the fourth consecutive time. Q2 GDP grew 3%, driven by consumer spending. An agreement was reached with the EU to cap tariffs at 15%, and the trade truce with China remains in place following new negotiations. Nonfarm payrolls came in below expectations, with 73,000 jobs created in June. 

• Europe: Eurozone GDP grew 0.1%, with strong performance in Spain and France. Germany and Italy remain laggards. Inflation in Germany fell to 1.8%, below the ECB’s target. 

• China: Industrial profits fell 4.3% in June, and manufacturing contracted for the fourth straight month. 

• Brazil: In response to new U.S. tariffs, the government is preparing support measures for affected sectors. The central bank kept its benchmark rate at 15%, signaling the end of its tightening cycle. 

• Mexico: Q2 GDP grew 0.7%, beating forecasts. The tariff pause with the U.S. was extended, keeping current rates in place. 

“It’s not whether you’re right or wrong that matters, but how much money you make when you’re right and how much you lose when you’re wrong.” — George Soros 

Important events in the next week 

• In the United States, the ISM Services Index will be released on 08/05 
• In China, inflation data will be published on 08/11 

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