What Jumps Out: The Elephant in the Room

Firstly, Nicolas Petro, son of Colombian President Gustavo, has now been arrested on charges including money laundering. The key here is that the president called for the investigation and has stepped away, obviously having expressed his sadness as a parent.

Today, we have the Banco de la República central bank meeting and it’s hard to imagine any change to the 13.25% overnight rate — but there will be a lot of focus on the tone of the press conference when it comes to future rate cuts. The committee will also publish this week their latest Monetary Report.

The National Administrative Department of Statistics (DANE) will release June unemployment data today (estimated to be 11.6%), and while these numbers have been solid in 2023, there will be close interest in the year-over-year comparison. Are we still creating more jobs than we are losing?

Elsewhere on the macro front, we have Banco Davivienda’s PMI data for July. Last month (49.8) the economy was in the red. What will this time hold?

Finally, we have the export data for June. A total of $3.9 billion USD is anticipated, but the devil will be in the detail. Are oil sales still struggling? Is coal still propping up the data? Are any other sectors showing signs of life?

READ MORE: Son of Colombian President Gustavo Petro Arrested On Corruption Charges

Reforms will no doubt be in the headlines this week as new and revised government proposals are expected to be submitted to Congress.

Related to that, the Colombian peso, which supposedly will collapse if the reforms make headway, remains the best performing currency on the planet (largely due to 2022 fourth quarter panic selldown). It seems unlikely that will change, with US rates seeming to have topped out and oil back close to $85 a barrel. Apart from that, the institutions are performing well and therefore any of the very necessary reforms will be measured as opposed to radical.

As for the equity market, I really need to write in depth on the subject, there is little hope of any momentum change. There appears to be a complete vacuum when it comes to leadership around the issue. The Bolsa de Valores de Colombia (BVC) appears more preoccupied with the Chile/Peru merger process, which is slipping ever further behind schedule and Asobolsa have come up with absolutely zero solutions. Surely, change is needed somewhere.

Other themes to keep an eye on:

• More decrees related to El Niño
• Any pronouncements from new Energy Minister
• Developments in Grupo Éxito sale process.

Finally, happy news as the Colombian women’s football team won their match at the World Cup versus Germany. This was a shock but perhaps even more so considering how hard the ladies had to struggle for recognition, sponsorship and respect in Colombia. Great stuff.

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