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South American economic overview - March 13, 2007

Wednesday, 14 March 2007 01:54:15 (GMT+3)   |  
       
Argentina: GDP: + 8.5% in January Consumer Prices: + 9.6% during latest 12 months through February (11.5% for the same period a year ago); February's low 0.3% was regarded with skepticism because of a change in the methodology. Argentina remains number 2 in the South American inflation ranking, behind Venezuela (#1) and ahead of Uruguay (# 3 with 6.8%). Industrial Production: + 2.2% in January Unemployment: 8.4% in December 2006 Trade Balance: + $12.0 bn for the latest 12 months through January Government Budget Balance: + 1.1% of GDP (Consensus Forcast for 2007) Currency Unit: Pesos 3.10 to US$1 as of March 7 (Pesos 3.08 to US$1 a year ago) Steel Production: 336,000 mt in January (412,000 mt a year ago) Brazil: GDP: a disappointing + 2.9% for 2006 (compared 2.3% in 2005 and + 3.8% in Q4 2006) CPI: + 2.9% for the latest twelve months through February 15 (5.7% in January 2006), + 3.14% for 2006 and + 3.9% forecast for 2007 Industrial Production: + 4.5% in January; automobile production for February was 201,000 units, a decline of 2% over last year; production of capital goods increased 18.4% in January. Interest: In an attempt to trigger stronger economic growth, the Central Bank cut the benchmark lending rate yet again, to 12.75%. Unemployment: 9.3% in January 2007 Trade Balance: $45.8 billion in February 2007 (latest 12 months through February) Current Account Balance: + $14.2 billion in January (latest 12 months through January) Government Budget Balance: -2.2% of GDP (Consensus Forecast for 2007) Currency: Real 2.11 to US$1 as of March 7 (Real 2.17 to US$1 a year ago) Steel Production: 2.70 million mt in January (2.6 a year ago) Chile: GDP: + 4.6% in January Consumer Prices: + 2.7% in February. Consumer confidence fell to an index of 52 in January, 2.1 points below December and 6.5% below February 2006. Industrial Production: + 3.7% in January Interest: The overnight lending rate is expected to stay steady at 5%. Unemployment: 6.1% in January Trade balance: + $24.4 bn for the latest 12 months through February; overall exports increased 45% in 2006 even though exports of agricultural products grew by only 11%. Government Budget Balance: + 4.3% of GDP (Consensus Forecast for 2007) Currency: Pesos 537 to US$1 as of March 7 (Pesos 533 to US$1 a year ago) Copper Price: $2.67 / lb for May delivery – 34% below the record price level of May 2006; overall, the copper price surged 41% in 2006. Steel Production: 140,000 mt (e) in January (139,000 mt a year ago) Venezuela: GDP: +11.8% in Q4 Consumer Prices: + 20.4% in February. Too much money is chasing an insufficient supply of goods. From January to November 2006, 109% of new Bolivars were injected into the economy, but neither domestic production nor imports could follow this pace. Industrial Production: 12.2% in September 2006 Unemployment: 11.1% in January Trade Balance: + $33.0 bn for the latest 12 months through Q4 2006; imports reached a new high of $32.2 billion in 2006; crude oil sales rose to $58.4 billion last year. Current Account: + $27.2 bn for the latest 12 months through Q4 2006 Government Budget Balance: - 3.8% of GDP (Consensus Forecast for 2007) Currency: Bolivar 3,798 to 1US$ as of March 7 (Bolivar 2,721 to US$1 a year ago) Steel Production: 430,000 mt (e) in January (426,000 a year ago). Measures to curb steel imports have gone into effect December 5, 2006. Foreign exchange has to be allocated and import licenses have to be issued. It takes the Commerce Department up to three months to issue import licenses. Consequently, steel inventories are dwindling alarmingly.

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