Macro themes at the IMF and World Bank meetings focused on the US, tariffs, and the shifting global landscape. Some backtracking gave markets hope of a 'Trump put' and lifted spirits. However, more concrete de-escalation may be needed. Uncertainty still runs high and scenarios diverge significantly. Recession is not the base case for all. Moreover, policymakers and investors do not seem ready to recognize a full regime change just yet. However, most recognized to be engaged in some form of diversification away from the US. We discussed US and EM views, alternatives and some specific LatAm issues including Brazil's enhanced potential as a China’s trade partner and the room for lower rates, a more constructive outlook on Mexico, Argentina’s Rockstar perils or Colombia’s growing fiscal risks.
For more, please see full note.