Macroprudential policies in Latin America

BORTZ PABLO GABRIEL

inancial Openness, Financial Fragility and Policies for Economic Stability

Comisión Económica de América Latina y el Caribe

Año: 2023; p. 257 - 304

This survey reviews the experience of five Latin American economies (Brazil, Chile, Colombia, Mexico and Peru) with macroprudential policies (MPPs) in the 2000s. These countries experienced similar developments in their balance-of-payments during this millennium, being net recipients of surges of capital inflows before and after the global financial crisis (GFC) in 2008, and a fall in inflows after 2014. Throughout these years, and particularly after the GFC, all had current account deficits and negative Net International Investment Positions (NIIP). All of them witnessed episodes of accelerated credit growth, but rarely saw episodes of banking or financial crisis. Their financial system weathered the 2008 crisis with relative resilience, aided by the policies implemented by monetary and banking authorities. Many of them adopted most of the measures that comprise Basel III regulatory standards, while some of them had already implemented similar measures even before Basel III.