Filtered by Region: Emerging Markets Use setting Emerging Markets
A soft start to Q3 The weaker-than-expected batch of Polish activity figures for July is more likely to be a blip than the start of a soft patch. We remain comfortable with our view that Poland’s economy will expand by around 3% over the year as a whole, …
22nd August 2024
Inflation plunge seals the deal on a rate cut in September The larger-than-expected decline in South Africa’s headline inflation rate, to 4.6% y/y, in July strengthens the case for the SARB to start its easing cycle with a 25bp cut to 8.00% at its next …
21st August 2024
Bank Indonesia today left its policy rate unchanged at 6.25%, but the central bank’s dovish commentary supports our view that rates will be cut before the end of the year. Today’s decision was correctly predicted by all 30 analysts polled by Reuters, …
CBRT staying the course The Turkish central bank (CBRT) left its main policy rate unchanged again today, at 50.00%, and offered little sign that it will soon start an easing cycle. While most other analysts expect monetary loosening to start in Q4, we …
20th August 2024
Strong domestic demand means BanRep likely to maintain the pace of easing The Colombian economy isn’t nearly as weak as the meagre 0.1% q/q rise in headline GDP in Q2 would suggest; there was a large drag from net trade while domestic demand remained very …
15th August 2024
Inflation finally on the way down Nigeria’s headline inflation rate eased to 33.4% in July, the first time it had slowed in 19 months, as the passthrough from previous naira falls has finally started to faded. With inflation having now peaked, we think …
Inflation likely to ease as 2025 approaches Saudi Arabia’s headline inflation rate was unchanged at 1.5% y/y in July, but we expect that the headline rate will ease back over the remainder of this year and potentially fall back below 1% y/y by early 2025. …
Deceleration eases with growth nearing turning point After slowing in Q2, economic momentum appears to have stabilised somewhat last month, with a pick-up in consumer spending and services activity largely offsetting a slowdown in investment and …
Strong second quarter will dampen expectations for rate cuts The larger-than-expected pick-up in Polish GDP growth in Q2, to 1.5% q/q (from 0.8% in Q1), suggests that the risks to our forecast for GDP to expand by 3% over the year as a whole are now …
14th August 2024
Credit growth starts to recover, private demand still weak Broad credit growth ticked up in July, while bank loan growth only slowed a touch. (See Chart 1.) We expect a continued acceleration in government bond issuance to support a further expansion of …
13th August 2024
Economy slows in Q2, but headline inflation rises further The slowdown in Russian GDP growth in Q2, to 4.0% y/y, suggests that the economy has lost a bit of momentum. But overheating pressures remain alive and the increase in inflation to 9.1% y/y in July …
9th August 2024
Food prices drive up inflation but domestic demand remains weak Consumer price inflation ticked up in July, but this was entirely due to a weather-related rise in food price inflation. Producer price deflation was unchanged. While a ramp-up in fiscal …
Easing cycle continues despite peso weakness Mexico’s central bank opted to reduce its policy rate by 25bp, to 10.75%, at today’s meeting and the statement generally retained the moderately dovish tone from the last one. We think further rate cuts are …
8th August 2024
Rise in inflation leaves Banxico decision on a knife edge The rise in Mexico’s headline inflation rate, to 5.6% y/y in July, alongside the weakness in the peso means that Banxico’s interest rate decision later today will be a very close call between a cut …
This report has been updated with additional analysis and a chart and table of key figures. Inflation falls despite subsidy cuts Egypt’s headline inflation slowed from 27.5% y/y in June to 25.7% y/y in July, its lowest rate since December 2022. And this …
RBI could ease policy by year-end The recent market turmoil didn’t move the needle for the MPC today: it continued to strike a hawkish tone as the majority of members voted to keep the repo rate unchanged at 6.50%. But with inflation set to fall back …
Exports to stay robust, helped by NEER depreciation Growth in export values slowed last month, but this was mainly due to lower export prices. Export volumes remained near record highs. We expect outbound shipments to stay strong for a while, not least …
7th August 2024
25bp cut likely to be followed by more easing The Central Bank of Kenya delivered a 25bp cut to its policy rate, to 12.75%, at its meeting today as it embarked on long-trailed easing cycle and, with inflation set to fall further from here, additional cuts …
6th August 2024
Non-oil sectors in the Gulf continue to cool This response has been updated with additional analysis, including of Qatar's PMI. July’s batch of PMIs were softer across the board, adding to signs that activity in private non-hydrocarbon sectors in the Gulf …
5th August 2024
Disinflation process underway, but it will take time The large fall in headline inflation in Turkey in July will provide some comfort to the central bank that the disinflation process remains on track, although it will take time for policymakers to be …
Strong PMI suggests economy is finally picking up South Africa’s manufacturing PMI jumped in July, suggesting that improving electricity supply conditions and reduced political uncertainty are starting to support activity. While the economy may finally be …
1st August 2024
PMIs point to softer demand in Russia and Turkey The manufacturing PMIs for July suggest that industrial sectors lost a bit of momentum in Turkey and Russia at the start of Q3, although demand conditions still appear very strong in Russia. In both …
Activity softens a touch at the end of Q2 Russia’s economy lost a bit of steam in June, but it still looks like GDP growth over Q2 as a whole was very strong, with growth tracking at 4.5-5.0% y/y. Industrial production growth slowed from 5.3% y/y in May …
31st July 2024
External demand no longer driving growth Hong Kong’s GDP growth slowed significantly in Q2, with activity expanding by just 0.4% q/q, down from a strong 2.3% q/q expansion in Q1, although this was slightly stronger than both we and the consensus expected …
Strong non-oil growth underpins solid Q2 Saudi Arabia’s flash estimate of GDP showed that that the economy grew by a solid 1.4% q/q in Q2 and, while non-oil activity is likely to slow over the second half of this year, it will be more than offset by …
Further signs of recovery losing momentum The European Commission's Economic Sentiment Indicators for Central and Eastern Europe (CEE) generally fell in July, and our regional-weighted measure hit a five-month low, providing additional evidence that the …
30th July 2024
Recoveries stutter in Q2 The weaker-than-expected Q2 GDP data out of Czechia and Hungary show that weak external demand is still acting as a constraint on the speed of recoveries in Central Europe. While we expect growth to strengthen over the second half …
Leadership flags increased policy support but offers few new ideas The readout of the Politburo’s latest triannual meeting on economic affairs has just been published by state media. It was dovish in tone and adds to recent evidence that the leadership …
The State Bank of Pakistan (SBP) lowered its policy rate by 100bps today, and further easing is likely later in the year. Today’s cut marks the second consecutive meeting where the central bank has reduced interest rates. Prior to that, the policy rate …
29th July 2024
CBR delivers bumper hike, leaves door open for further tightening Russia’s central bank (CBR) stepped up to the plate with a 200bp hike to its key policy rate today, to 18.00%, in response to the overheating economy and a renewed surge in inflation. While …
26th July 2024
Surprise cut points to mounting policymaker concern The PBOC’s decision to cut the 1-year interest rate on its medium-term lending facility (MLF) earlier today is unusual for two reasons. First, the 20bp reduction is double the size of the PBOC’s usual …
25th July 2024
Inflation edges down providing cover for interest rate cut in September South Africa’s headline inflation rate edged down to 5.1% y/y in June and with core inflation returning to the mid-point of the SARB’s 3-6% target range, we think the SARB will be in …
24th July 2024
Cardoso’s 50bp hike likely the last, but cuts a long time off The Central Bank of Nigeria delivered a 50bp hike to its policy rate, to 26.75%, at its meeting today and, while this probably marks the end of the tightening cycle, Governor Cardoso’s …
23rd July 2024
Rates on hold, cuts still some way off Turkey’s central bank left its key policy rate on hold today, at 50.00%, and the communications accompanying the decision suggest that interest rate cuts are still some way off. While most analysts expect a monetary …
Economic recovery still on track Poland’s retail sales data released today were slightly weaker than expected, but the big picture is that the whole set of activity data for June suggest that the economic recovery has remained relatively strong. Taken …
22nd July 2024
PBOC responds to leadership's call for more easing The PBOC has lowered its short-term policy rate for the first time since last summer, in line with our expectation for a cut this quarter. Its efforts to prevent long-term yields from falling therefore do …
SARB holds interest rates but cut now likely in September The South African Reserve Bank decision to leave its repo rate unchanged at 8.25% was of little surprise but there was increased optimism that inflation is moving towards the 4.5% mid-point of the …
18th July 2024
BI hints at rate cuts in Q4 Bank Indonesia today left its policy rate unchanged at 6.25%, but the central bank’s dovish commentary supports our view that rates will be cut in Q4. Today’s decision was correctly predicted by all 35 analysts polled by …
17th July 2024
Inflation nudges down but a minor bump is on the cards in Q3 Saudi Arabia’s headline inflation rate edged slightly down to a six-month low of 1.5% y/y in June and, while we expect a small increase in the headline rate during Q3, the bigger picture remains …
16th July 2024
Inflation at a peak Nigeria’s headline inflation rate edged up to 34.2% y/y in June on the back of the pass-through from previous naira falls. But we think this marks the peak and inflation should start to decline. If right, that’s likely to lend more …
15th July 2024
This page has been updated with additional analysis since first publication. Growth slowed last quarter but should regain some ground in H2 Weaker-than-expected official GDP figures show that China’s economy lost momentum in Q2. But we doubt this marks …
Surprise inflation jump scuppers August rate cut hopes The surprise jump in headline consumer price inflation last month will be enough to convince any MPC members who may have been leaning toward rate cuts at the August policy meeting that conditions are …
12th July 2024
Credit growth hits a new low Both bank loan and broad credit growth hit a record low in June. While further fiscal loosening may provide some support to credit growth in the near-term, the continued weakness of the property sector means that any increase …
This page has been updated with additional analysis since first publication Tailwind from strong exports set to persist Export values grew y/y at the fastest pace in 15 months, with export volumes hitting record highs. We think exports will stay robust in …
Inflation strengthens, rate hike baked in later this month The rise in Russian inflation to 8.6% y/y in June, alongside weekly figures suggesting that an even larger rise is possible in July, seals the deal on an interest rate hike later this month. We …
10th July 2024
Inflation falls despite bread price hikes Egypt’s headline inflation slowed from 28.1% y/y in May to 27.5% y/y in June, the lowest outturn since the start of 2023. And this came in spite of the baladi bread price hike. Increases to electricity and fuel …
This page has been updated with additional analysis since first publication. Persistent overcapacity will keep inflation low Consumer price inflation edged down in June. Producer price deflation eased but this was entirely due to base effects. We still …
This page has been updated with additional analysis since first publication. Rates on hold amid elevated risks Israel’s central bank (BoI) left its policy rate on hold at 4.50% as expected today and interest rates are likely to remain on hold for the time …
8th July 2024
Easing cycle underway, but expect it to be gradual Romania’s central bank (NBR) started its easing cycle at today’s meeting with a 25bp rate cut, to 6.75%. But with inflation and fiscal risks still high, this is likely to be a slow and gradual cycle and …
5th July 2024
Activity running hot, inflation rising further The latest activity data suggest that Russia’s economy continued to motor along in May, driven by stronger growth in industry. The economy is clearly overheating and this continues to fuel inflation …
3rd July 2024
