Monetary policy in Latin America

Latin America's central banks acted promptly and decisively to contain the  consequences of the global inflation shock, as described in the new PIIE Policy Brief Monetary policy in Latin America: The easing cycle has begun. The tightening cycle began when Brazil moved to increase rates in early 2021, and other Latin American inflation-targeting central banks followed suit later that year. During the second half of 2022, in most of these countries inflation and inflation expectations started to drop, allowing for easement in the tightening cycle that began in Chile in July 2023, followed by Brazil and Peru. In Colombia and Mexico, monetary authorities believe that high and sticky inflation still requires historically high real rates to anchor inflation expectations.

This virtual seminar discusses the lessons learned from the implementation of monetary policy in Latin America to contain the global post-pandemic inflation shock, how the easing cycle should continue during 2024 and beyond, and the main financial risks that the region faces. The panel also focuses on the stabilization attempt recently launched by the new government in Argentina and the key elements needed for this effort to succeed.

A moderated Q&A with PIIE C. Fred Bergsten Senior Fellow Maurice Obstfeld follows.

MODERATOR

Maurice Obstfeld 
C. Fred Bergsten Senior Fellow, PIIE

PRESENTERS

Monica de Bolle 
Senior Fellow, PIIE

José De Gregorio
Nonresident Senior Fellow, PIIE

Alejandro Werner 
Nonresident Senior Fellow, PIIE