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Consulting firm reduces LatAm's economic growth forecast
Last Updated: 2018-10-11 13:13 | Xinhua
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Latin America's economy could grow 1.7 percent this year, 0.2 percentage points lower than the September forecast, according to a report released Wednesday by a consulting firm.

Looking to 2019, FocusEconomics also reduced its forecast for the regional gross domestic product (GDP) to a 2.4 percent growth, which is also 0.2 percentage points lower than its forecast in September.

"The forecast growth for Latin America, excluding Venezuela, both for 2018 and 2019, was reduced this month, primarily due to the worsening of the trajectory of the Argentine economy," FocusEconomics said in its study.

"It's forecast that high inflation, fiscal austerity and the worse than expected impact of the drought, will push the economy into a recession in 2018 and next year," read the report.

Its forecast is based on a survey among more than 200 specialized participants.

FocusEconomics also said the performance of Argentina's economy is quite uncertain, depending on not only the assistance program with the International Monetary Fund, but also the reestablishment of investor confidence and more solid macro foundations.

According to the report, the Mexican economy, the second largest in Latin America behind Brazil, could grow 2.2 percent in 2018 and 2019, thanks in a large part to the free trade agreement reached on Sept. 30 between Mexico, Canada and the United States.

When it comes to Brazil's growth rate, the firm foresees a drop of 0.1 percentage points for 2018 and 2019, to 1.5 and 2.3 percent respectively.

"It is expected that Brazil's recovery will increase as long as the politicians place their attention on the economy and the effects of the truckers' strike dissipate," read the report.

FocusEconomics chose to remove Venezuela from its analysis list due to limited access to official data.

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