Macroeconomic Forecast Paraguay

Along with many emerging market currencies, the guaraní has appreciated sharply against the US dollar recently, as the greenback continues to plunge on world markets. At the start of November, the exchange rate stood at PYG4,700/US$, already significantly above our year-end target of PYG5,020/US$. However, the PYG is a notoriously volatile currency unit, and although we acknowledge the upside risks, an approaching election, widespread drought, and seasonal factors mean we leave our forecast unchanged for now. Given the strength of the Brazilian

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