CDS: Brazil To Outperform Mexico

While a guarded return of global risk appetite augurs well for Latin American equities, at least in the short term, we remain broadly cautious on the region's credit default swap (CDS) market for now. Notwithstanding the notable outperformance of Argentina's 5-Year sovereign CDS - which, as we commented upon yesterday, has narrowed by 1,800bps since December - Latin CDS spreads continue to trend upwards. As governments across the region pump money into the domestic economy in a bid to prop up growth, investors are likely to remain wary of the potential fiscal impact on sovereign creditworthiness. What is more, given

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