The new macroeconomic paradigm in Latin America has been built upon the lessons from our history of macroeconomic volatility, and still needs to consolidate itself definitively finding the right balance between credibility and flexibility.
While there are several ways to implement it according to the specificities of each country, the basic principles – which, in my view, have already been institutionalized – can be summarized into five pillars: (1) robust monetary and financial policy approaches, (2) more flexible exchange rate regimes, (3) fiscal solvency, (4) external sustainability with market openness, and (5) financial policies that favor the creation of liquidity and solvency buffers.