Macro
ColombiaBanRep surprised the market on 31 July by holding the policy rate at 12.00% in a 4–3 split, with three members voting for a further 50bp hike after June’s 75bp increase; consensus had looked for 12.50%, and rising inflation expectations were the board’s stated concern (Rio Times, Banco de la República).
MexicoINEGI’s preliminary Q2 estimate (30 July) put growth at 1.5% q/q and 2.1% y/y, the strongest quarter since late 2020, flattered by World Cup consumption and a 3.3% q/q primary-sector rebound; the finance ministry says the 1.5% full-year target is secure barring a second-half contraction (Mexico News Daily, Reuters via WKZO).
BrazilMid-July IPCA-15 slowed to 4.52% y/y, below every forecast in the Reuters poll (median 4.67%), bringing 12-month inflation to the edge of the 3% ±1.5pp band and clearing the path for a fourth consecutive Selic cut next week (Reuters via Yahoo).
LatAmRegional risk assets closed July on a rally: Ibovespa +1.88% to 177,159, Merval +2.22%, COLCAP +1.64%, Mexbol +1.28%, with the real up 1.14% to 5.06 and the peso up 0.54% to 17.34 on a softer dollar and a more cautious Fed (Rio Times).
Financial & Insurance Markets
ColombiaAlongside the hold, BanRep opened a programme to accumulate up to US$4bn of international reserves through monthly put-option auctions, the first on 3 August with a US$400m maximum quota — an FX-framework change as consequential as the rate call itself (Rio Times).
LatAmThe 1 July renewal cleared decisively in buyers’ favour: property cat excess-of-loss risk-adjusted rates fell 15–20% and ceding commissions rose two to three points as Bermuda, London and MGA capacity crowded into the region (Commercial Risk, Insurance Business).
MexicoThe sovereign parametric stack now stands at roughly US$1.17bn in force after the 2026 renewal doubled the insurance layer to US$575m alongside the IBRD cat bonds — the region’s deepest multi-layer structure, and Mexico’s ninth generation of sovereign cat cover since 2006 (InsuraBeat).
BrazilFitch sizes the LatAm reinsurance market at US$18–22bn and expects cat bonds plus the new Letras de Risco de Seguro to widen the region’s insurance debt market following Brazil’s first ILS issuance (Artemis, Artemis).
Political
PeruKeiko Fujimori was sworn in on 28 July after winning by fewer than 50,000 votes; markets read the handover as investment-friendly and the sol firmed, with mining permitting and security the first tests of a thin congressional mandate (NPR, Rio Times).
ColombiaThe hawkish central bank sets an awkward backdrop for Abelardo De La Espriella, who takes office on 7 August; June’s 75bp hike was explicitly framed as the first post-election decision (Central Banking).
BrazilOctober’s presidential and congressional elections remain the region’s last major electoral event of the supercycle, now framed by the 25% US tariff in force since 22 July (AS/COA).
LatAmThe 2026 supercycle has delivered incumbent-punishing swings to the right in Argentina, Chile, Colombia and Peru; analysts read it as anti-incumbency on security, inflation and corruption rather than a clean ideological realignment (J.P. Morgan, GIS Reports).
Regulatory
ColombiaThe reserve-accumulation mechanism is a live operational change to the FX framework: monthly put-option auctions capped at US$400m, running to a US$4bn ceiling, starting 3 August (Rio Times).
BrazilThe Letras de Risco de Seguro regime is now operational and, per Fitch, opens a domestic ILS funding channel for insurers following the country’s first ILS deal (Artemis).
MexicoBanxico announces on 6 August with consensus for a hold at 6.50%, the board having signalled in May that the easing cycle begun in 2024 has concluded (Mexico Business).
PeruAM Best maintained its stable outlook on Peru’s insurance industry on 24 July, a useful marker of supervisory continuity as the Fujimori government takes over (Business Wire).
El Niño / Climate & Nat Cat
LatAmNOAA CPC’s 9 July diagnostic discussion keeps an El Niño advisory in force: SST anomalies above +1.0°C across the central and eastern equatorial Pacific, a 97% chance the event persists into early spring 2027, and an 81% chance it reaches “very strong” in October–December, potentially among the strongest since 1950 (NOAA CPC).
Central AmericaDrier-than-normal conditions are already established across Central America, parts of the Caribbean and northern South America, with the deficit forecast to extend into the Amazon basin; wildfire, hydro generation and agricultural stress are the near-term transmission channels (Rio Times, AP via KSAT).
PanamaThe canal is the most consequential single logistics exposure: a strong El Niño compressing wet-season inflows would tighten draft limits and daily slot allocations and lift auction prices for priority passage, with knock-on marine, cargo and trade-credit implications (Rio Times).
CaribbeanCCRIF grew its parametric pool 9% to US$1.57bn of coverage limits ahead of the 2026 season, adding utility members (Jamaica Public Service, Nevis Electricity) and a fisheries product for Jamaica; the pool remains untriggered year to date (Artemis).
VenezuelaNo new major LAC nat cat in the past 24 hours. The standing events remain the 24 June M7.2/M7.5 north-central Venezuela earthquakes (3,535 dead, 16,740 injured per OCHA) and the 3 July Zamora River flooding in Ecuador’s Amazonian province (OCHA).
Coming Up
3 AugColombiaBanRep’s first reserve-accumulation put-option auction, maximum quota US$400m (Rio Times).
4–5 AugBrazilCopom decides on the 14.25% Selic; a fourth consecutive 25bp cut is consensus after the softer IPCA-15 (BCB).
6 AugMexicoBanxico monetary policy announcement, 13:00 CST; consensus is a hold at 6.50% (Mexico Business).
7 AugColombiaAbelardo De La Espriella is sworn in as president, with a September tax package already flagged (Central Banking).
10 AugMexicoINEGI publishes the July INPC, the last inflation read before the September Banxico meeting (INEGI).
On the Radar
Policy divergenceColombia holding at 12% while Brazil cuts, Mexico pauses at 6.50% and Chile sits at 4.50% is the widest intra-regional policy spread in years. Watch COP carry positioning, local-curve steepening, and whether the reserve-accumulation programme leaks into COP weakness that forces the board’s hand in September.
Soft market into a hard hazard yearProperty cat XL down 15–20% risk-adjusted at 1 July, priced against an 81% probability of a very strong El Niño in Q4. Attachment discipline and aggregate accumulation are the things to watch as cedents build 1 January structures on 2026 pricing.
Correlated water stressPanama Canal draft, Colombian and Brazilian hydro reservoirs, and Central American agriculture all key off the same rainfall deficit. That is one peril producing correlated marine, energy, agro and sovereign-liquidity claims — the kind of correlation parametric structures are least good at absorbing.