First quarter GDP reports for Latin America, released over the last couple of weeks, surprised to the upside. According to consensus surveys conducted earlier this year, several economies were expected to contract in quarterly terms – in the event, not one major economy in the region declined versus the fourth quarter of last year. GDP growth in the six major Latin American economies expanded 6% in quarterly annualized terms in Q1-21, after growing 17% in Q4-20. We can draw several conclusions about this outperformance from the data. First, services sectors are becoming more resilient to unfavorable pandemic developments – this is the main reason for the upside surprise on Q1 GDP growth. Second, the rally in commodity prices is certainly helping the region, but it’s not why GDP was stronger than expected. And third, nothing has changed to modify the long-term growth outlook for the region – GDP growth will converge to its normal low of 2-3% on average in the coming years.