Publications

The recent appreciation of the euro against the dollar—more than 10% since the lows at the beginning of the year—has shifted the price competitiveness of Spanish companies and the purchasing power of households.

In the second week of September, Bre-B, the new low-value payment system developed by the Central Bank of Colombia (Banco de la República), will become operational. Its value proposition includes the ability to make payments and transfers that are free, secure, and easy between individuals and businesses.

Global uncertainty, especially on geopolitical and commercial issues, has been creating a complex and atypical environment for Latin America in 2025. This has led to high market volatility, caution from monetary policy, and broader than normal ranges when forecasting economic variables.

The Bank of the Republic maintained the policy rate at 9.25% in June, with a divided decision. While inflation showed a marginal reduction and growth continues a gradual recovery, they emphasized the larger estimated fiscal deficit and its effect on the economy and the Bank's interest rate profile.

Mid- and long-term Treasury yields have pulled back from last month’s highs amid soft inflation prints and dovish signals from Fed officials like Bowman and Waller, who have voiced support for a July rate cut.

Argentina’s economy kept recovering in Q2 2025, driven by fiscal order, a re-monetization strategy, and a flexible exchange rate scheme. The outlook is still shaped by the electoral context and the challenge of ensuring lasting stability in a volatile global environment.

We identify the main drivers of key financial market asset price dynamics, including the Euro-dollar exchange rate and the Bund-US Treasury yield spread, using a sign-restricted SVAR model. The model also facilitates the extraction of a high frequency global macro-financial conditions indicator.

While directionally consistent with our expectations, the SEP adjustments (higher inflation, weaker growth, and a slightly higher unemployment rate) were not sufficient to alter the median fed funds rate projection for end-2025, which remains at 3.9% (two cuts).