Marktbericht Lateinamerika Apr09

The first quarter was difficult for Latin America as the global economic crisis took its toll on economies across the region.

Executive Summary

• Latin America has started to feel the aftershocks of the global economic crisis. Central banks in the region have cut key interest rates in light of lower inflation expectations and decelerating growth, and governments announced stimulus efforts designed to support consumer confidence, extend credit and generate demand.
  
• Stock indices and local currencies have taken a bumpy ride. The majority of the stock indices in the region managed to finish in positive territory for the quarter, while local currencies remain very volatile.
  
• Weakening consumer demand, both within Latin America and in its principal export markets, prompted manufacturers in the region to decrease production and make further employment cuts. Industrial tenants are seeking leases with lower rents and shorter terms.
  
• Office vacancy rates are on the rise as companies look to cut costs and postpone expansion plans. The retail market is also weak. Some small shops are closing, and larger retailers have put expansion plans on hold.
  
• While home sales targeting higher-income households have suffered, sales targeting lower-income households have remained stable. The sector is set to benefit from government stimulus efforts designed to facilitate access to mortgage financing.