Parting Shot: Reversal of fortune

Parting Shot: Reversal of fortune

For commodity exports, high prices with high volatility are the new norm. Prices have declined by more than 10% from their recent peak in February, but are almost twice as high as 10 years ago, and 70% higher than in 2008. Rising terms of trade have led to growing prosperity, to an extent not observed in many years. Policymakers in Latin America are nervous because of higher inflation, increased public sector deficits, and external current account gaps. But fundamentally they feel comfortable because of the resiliency shown in recent years, and because of a benign world outlook. As the rise in commodity prices slows and the volatility of these prices increases in the years to come, can thi

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