Key events in EMEA and Latam next week

The second GDP reading for the third quarter should confirm growth of 3.9% year-over-year. We expect small changes in private consumption (~4.4%YoY), a deceleration of investment and a neutral or even positive contribution from net exports.

A further moderation in activity should occur in the fourth quarter. We expect retail sales to stabilise close to 5% YoY at current prices in October. The introduction of new fiscal programmes has not resulted in greater consumer spending so far.

After a series of favourable data points, we expect the positive momentum to continue. Economic sentiment indicators might show some improvement due to strong GDP growth and rumours about a new economic protection action plan (read: fiscal spending) by the government. Speaking of GDP, the Statistical Office is releasing the details of economic activity and we expect domestic factors to remain the key drivers of growth. We see wage growth holding up, and in fact think it could show a further strengthening on the back of the wage settlement in education combined with the aftereffects of the July cut in the payroll tax.