Economic growth in Latin America looks set to slow to around 4 percent in 2005 from last year's levels above 5 percent, the highest growth rate in more than 16 years, Mexico's central bank governor said on Sunday. "This year we expect some deceleration, to about 4 percent," Guillermo Ortiz told a news conference in Sweden after attending an international conference on inflation targeting.
"The favourable impact of commodity prices and oil that was beneficial to the region last year is fading a little bit but nonetheless the general outlook of the region is positive," he said.
The inflation outlook varied, with Mexico and Brazil currently witnessing "inflation already coming down", while in Argentina there was "some concern about higher inflation this year," Ortiz said.
The main risks to Latin America's economies were linked to the performance of the United States, where first-quarter growth had been "on the strong side", he said. The US economy grew at an annual rate of 3.5 percent in January-March.
"If we have ... the US growing more or less at capacity between 3 and 3.5 percent, then I think the (Latin American) region should do reasonably well this year and in 2006," Ortiz said.
All countries in the world might be affected by the way current economic imbalances, notably "the very high US current account deficit", will be resolved, he said.