Cracks Appear on LatAm Surface: BCP

BCP Securities continues to fret over the US economy, and by default LatAm. “Latin America remains strong, but there are cracks in the veneer,” says the boutique. “Some sectors are starting to show signs of slowdown, as the global situation impinges on consumer confidence,” it adds. BCP says LatAm banks are trimming lending conditions and increasing reserves, but it tips Peru, Mexico and Colombia as investor hot spots. “The economy is on track to grow more than 7% in 2008,” says the shop. “The government is taking concrete measures to improve its rating,” it adds. In Mexico, BCP sees vitality in MXP on the back of strong capital and trade inflows. “Soaring consumption, a pro-business political environment and a rash of economic reforms is inducing international investors to take another look at Mexico,” says BCP. The shop is meanwhile neutral Ecuador and Brazil, and underweight Argentina, Chile and Venezuela. The latter, warns BCP, is “on the path towards destruction.”