Falling inflation in EMs helps domestic growth

EMERGING MARKETS

Over the past 10 years, Latin America has made huge strides to become an important current and future contributor to global growth.

A commitment to orthodox fiscal and monetary policies from governments and central banks has seen inflation fall significantly in countries such as Brazil, Chile and Mexico, creating an environment conducive to domestic growth and investment. Demand for commodities has led to trade surpluses. Tax reforms and prudent government spending policies have led to current account surpluses in many countries, and economies are now more stable and less dependent on foreign inflows of capital. Indeed, fiscal deficits (% of GDP) are lower in most cases among the region’s countries than in the eur...