The Day at a Glance | December 21 2023

*Inflation in Mexico during the first half of December surprised to the upside due to increased airfares, tomatoes, and onions.
*Real GDP growth in the US was revised downward from 5.2% to 4.9% q/q for the 3Q23. GDP  growth is now forecasted to set at 2.7% in the 4Q23.
*Israeli attacks on Gaza escalate even as talks about a ceasefire become increasingly “serious.”
*Initial claims for state unemployment benefits increased by 200 thousand to a seasonally adjusted figure of 205 thousand during the week ending on December 16th. 
*The Central Bank of Brazil reaffirmed its easing pace amidst unanchored inflationary expectations.
*Argentinian President Javier Milei signed a decree to boost exports and deregulation.
Economic environment
In Mexico, general inflation for the first half of December set at 0.52%, surpassing the 0.42% expected figure. Thus, consumer inflation accelerated for the third consecutive biweekly period. Meanwhile, core inflation – which excludes more volatile components such as energy & agricultural products, and government fees – increased by 0.46% in the first half of December, practically in line with market expectations. On the other hand, non-core inflation increased by 0.68% biweekly, with a notable 3.32% q/q increase in fruits and vegetables. Three items with the largest impact on inflation during the biweekly period were air transportation, onions, and tomatoes. Regarding annual figures, general inflation for the first half of December set at 4.46% (4.36% e.). Core inflation set at 5.19% (5.30% prev.), below the market´s 5.22% expected figure.

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