Falling oil prices unlikely to stop EMEA equity gains

Despite the fall in oil prices that we expect over the coming years, we forecast the MSCI Emerging Markets (EM) EMEA Index to make further gains and continue to outperform the broader MSCI EM Index.
Nicholas Farr Assistant Economist
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Contagion from Turkey’s crisis likely to remain limited

Spillovers to other emerging markets from Turkey’s ongoing currency crisis have been limited so far and we think this will remain the case even if Turkey’s financial markets remain under pressure.

24 November 2021

DM Markets Chart Book

We think US inflation compensation will rise further

US 10-year inflation compensation has risen by another 20bp or so over the past month and we think it will increase further as inflation in the US proves more persistent than most expect. This is one of the reasons why we forecast the yields of long-dated US Treasuries to rise over the next two years.

19 November 2021

Global Markets Update

We now expect E-Z “peripheral” spreads to widen a bit

We now think that, rather than remaining broadly stable, the spreads of euro-zone “peripheral” bonds will widen somewhat over the next two years as the ECB gradually normalises monetary policy. That said, we still expect spreads to remain low by historical standards.

17 November 2021

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Emerging Europe Economics Update

Will supply constraints hold back the recovery in CEE?

Intermediate goods shortages and pandemic-related supply constraints across Central and Eastern Europe (CEE) are not going to disappear overnight and may hold back the pace of recovery in certain sectors. But they should eventually ease and we remain comfortable with our above-consensus GDP growth forecasts.

25 August 2021

Emerging Europe Data Response

Central & Eastern Europe GDP (Q2 2021)

The Q2 GDP data for Central and Eastern Europe revealed that the regional recovery gathered pace last quarter as economies reopened following virus waves in Q1. We expect the recovery to remain strong in the second half of this year, although low vaccine coverage clouds the outlook in some economies.

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Emerging Europe Economics Weekly

NBP a bit more hawkish, but poles apart from the CBR

A slew of comments from policymakers at Poland’s central bank (the NBP) this week suggest that the probability of the central bank delivering a rate hike before the end of this year has increased. Elsewhere, remarks from the Russian central bank (the CBR) governor in an interview with The Financial Times reinforce the point that policymakers there will do all they can to reduce inflation expectations. This supports our view that the CBR is likely to deliver another 75bp of hikes by the end of this year.

6 August 2021
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