Americas market summary
Here’s an Americas Market Summary for the week ending Dec 20th :
GDP (US$bn)
GDP QoQ (%)
Base Rate (%)
Inflation Rate (%)
Unemployment (%)
Debt/GDP (%)
Credit Rating (Moody’s/S&P/Fitch)
United States
27,361
3.1
4.75
2.7
4.2
122.3
Aaa/AA+/AA+
Brazil
2,174
0.9
12.25
4.87
6.2
84.7
Ba2/BB/BB
Canada
2,140
0.3
3.25
1.9
6.8
107.5
Aaa/AAA/AA+
Mexico
1,789
1.1
10.0
4.55
2.5
49.7
Baa2/BBB/BBB-
Argentina
641
3.9
32.0
166
6.9
155.4
Ca/CCC-/CCC
Colombia
364
0.2
9.5
5.2
9.1
54.3
Baa2/BB+/BB+
Chile
336
0.7
5.0
4.2
8.6
39.4
A2/A/A-
Peru
268
1.2
5.0
2.3
5.7
33.0
Baa1/BBB-/BBB
Global: the ICC released a new ‘roadmap to digitalizing trade’ – see below link – where in the UK alone, this initiative is expected to ‘deliver £25bn in economic growth, £224bn in efficiency savings and generate a 35% efficiency gain for SMEs…’
US/Canada
Mostly positive macro data: Q3 GDP revised up to 3.1%. Retail sales rose 0.7% MoM in Nov. Industrial prod’n dipped 0.1% MoM in Nov – 3rd consecutive decline. S&P’s manuf’ing PMI fell to 48.3 in Dec (below expectations) – 6th consecutive decline – while the Composite PMI rose to 56.6 (from 54.9). Housing starts fell almost 2% MoM in Nov (to ~1.3m units) while existing home sales rose 4.8% MoM in Nov – highest in 8mths. NABH housing index was unchanged at 46 in Dec. PCE index rose 0.1% MoM in Nov (below expectations). Initial jobless claims fell 22k to 220k in the week to Dec 5th (more than expected). UMich’s consumer sentiment was confirmed at 74 in Dec – highest in 8mths.
FOMC cut its fed funds range by 25bps to 4.25-4.5%, as expected; only 2 rate-cuts are expected in 2025 as GDP growth forecast is raised (slightly). Equities fell.
Congress scrambled to avert a partial govt shutdown after failing to pass a spending bill. CDS spread on govt debt ticked up.
Total debt of US corporates with ratings from S&P rose US$20bn QoQ to US$8.45trn at end-Sept, of which IG-rated companies owed ~US$6.63trn.
Leveraged loan market recorded US$398bn of primary market issuance in Q4 bringing the 2024 total to a record ~US$1.4trn! Of this, ~US$900bn comprised refinancings and repricings with ‘new-issue’ loan volume at ~US$500bn (see below)…
• Dept of Energy will provide a record US$15bn low-interest loan to PG&E – half of initially planned US$30bn – to help fight climate change and improve the electrical grid. DOE has made more than $42bn in loan commitments and over US$24bn in closed loans and guarantees under the current administration!
• Mercuria closed a US$3.4bn 1yr secured borrow base facility; JBRs: ING, MUFG and SocGen. Purpose: general corporate & working capital needs in North America.
• Canada’s MinFin resigned; cabinet reshuffled. Meanwhile, retail sales grew 0.6% MoM in Oct and were likely unchanged in Nov. Inflation inched down.
• Key benchmarks:
o 3MSOFR – 435bps; 3MEUR – 284bps, 10yr USTs – 4.53%; DXY – 107.8; VIX – 19.5; WTI crude – $69.5 p/b; gold - $2,623.5 p/oz, Bitcoin - $95,888 (as at 4:15pm ET)
LatAm
UN’s economic commission raised its 2025 economic growth forecast for LatAm & Caribbean to grow to 2.5% (from 2.3% in Aug).
Brazil’s real fell to ~6.26 per dollar before recovering (thanks to central bank support) reflecting ‘concerns over the govt’s fiscal credibility and worsening economic fundamentals.’
Elsewhere, Mexico’s retail sales fell 1.2% YoY in Oct – 6th monthly decline – while Banxico cut its base rate 25bps as inflation eases. Argentina’s GDP shrank 2.1% YoY in Q3 but grew ~4% QoQ! A trade surplus of US$1.4bn was recorded for Q3 vs a deficit of US$6bn a year ago, and consumer confidence index rose to 46 in Dec – highest in 13mths! Colombia’s manuf’ing prod’n rose 1.1% YoY in Oct – after declining ~4% YoY in Sept – and retail sales rose 9% YoY. Central bank cut its base rate 25bps… as did central banks in Chile and Jamaica. Ecuador reported a trade surplus of US$221m in Oct vs a US$178m deficit a year ago as imports fell almost 6% YoY to US$2.6bn.
Notable activity/issuance of note:
o Ecuador’s govt took a US$1bn 17yr debt-for-nature TL at ~6% in order to ‘free up US$800m in Amazon conservation projects.’ BofA was sole arranger.
o Inter-American Devpt Bank and BNDES (Brzn devpt bank) are set to provide ~US$900m for corporate investments in the Amazon region, while IDB Invest approved US$265m in loans to corporates in 4 Latin markets.
o Vesta (Mexican real estate developer) secured a US$545m 3-tranche syndicated sustainable loan from the IFC (US$100m), BBVA, Citi and Santander. Purpose: construct green industrial parks.
o Difare (Ecuadorian pharma) issued US$50m in 5yr SLBs arranged by IDB Invest (and Proparco) to help reduce its carbon footprint by 50%.
o Origo Energia (Brzn solar) secured a US$40m 10yr term loan from the IFC to help 22 solar farms in 4 states in 2026.