Stock Markets in Latin America Outpace Other Major Areas

Stock markets in Latin America are up sharply from late 2002. The Morgan Stanley Capital International index of Latin America EMF (Emerging Markets Free) stock prices in U.S. dollars has risen almost 15% in the last month and is up 23% from July 2002.

Currency appreciation in Argentina and Brazil have accounted for a part of the rise in dollar terms, but political changes have also been important. Brazil's new president who took office on January 1, has so far surprised investors by adhering to a tough government deficit reduction plan. In Argentina belief that the new president, who was inaugurated in May, will restructure the government debt together with a surge in exports has increased confidence.. Stock markets in Japan, Asian emerging markets and in the United States have increased in recent months, but remain below levels reached a year ago while the stock market in dollar terms in Europe shows little gain in spite of the rise in the Euro.