Brazil reported stronger than expected June retail sales figures, but here too the systemic concerns around paramount today. Retail sales rose 1% in June twice what the consensus expected. The dollar is trading at its best level against BRL since late July. A close today above BRL1.7650 may signal a move toward BRL1.80.
Argentina's economy is booming and this is increasingly being recognized. Recall Q1 GDP was 6.8% and May's economic activity index rose 12.4% year-over-year. This year's growth could be among the fastest in the world. Many institutional investors are taking another look at Argentina's GDP-linked bonds, which according to industry indices, are up by more than 25% in the past month. Recall these bonds have greater payout the stronger the growth. There is no payout this year because growth in 2009 was so poor (less than 1%). Q2 GDP will be reported on Sept 17. The higher wheat prices and a record soy crop is beneficial to Argentina as well. While Argentina has been a bit of a pariah since its crisis, the strength of the economy and the performance of its asset markets is seeing investors re-evaluate.
Disclosure: No positions