Filtered by Region: Emerging Markets Use setting Emerging Markets
Urban households still feeling positive As always, we need to treat Indian labour market statistics with caution, but unemployment data from private think-tank CMIE released this week were noteworthy. They showed that the overall unemployment rate soared …
3rd November 2023
Over half of cross-border settlement now in RMB Earlier this week, the People’s Bank published its annual report on renminbi internationalisation. The message from the 84-page document is that global use of China’s currency has been gaining momentum …
Egypt’s gas troubles after Israel cuts supplies Egyptian officials confirmed this week that imports of gas fell to zero after Israel turned off the taps, which will curtail efforts to restart LNG exports. And with gas being cut to energy-intensive …
2nd November 2023
The string of central bank meetings across Emerging Europe this week highlighted the unique challenges that policymakers across the region are currently facing, but one common thread in all countries is that inflation risks are persisting and we think …
27th October 2023
Giving with one hand, taking with the other Earlier this week, China’s legislature increased the government’s planned annual budget deficit from 3.0% of GDP to 3.8%. This was the first mid-year revision since 2008 and only the fifth in the PRC’s history. …
Strengthening ties with the Quad India’s government is pushing ahead with efforts to make India a key link in global manufacturing supply chains. The Cabinet this week approved a Memorandum of Cooperation with Japan on a semiconductor supply chain …
Saudi real estate market stuck in a gully The mortgage market in Saudi Arabia has struggled this year as interest rates have surged, which appears to be adding to the trend of the past few years of suppressed land and house prices. Data published over the …
26th October 2023
Fiscal support coming in Israel, rates to stay on hold There remains significant uncertainty around how the Israel-Hamas war will evolve, but developments this week confirm that fiscal policy will be loosened as policymakers provide support to the …
20th October 2023
Government is gearing towards elections Several policy measures announced by India’s government this week are likely geared towards shoring up popular support ahead of next month’s state elections and next year’s general election. The cabinet approved …
Q3 acceleration may be statistical mirage The GDP figures published earlier this week were stronger than most had expected . They showed that growth accelerated from 0.5% q/q in Q2 to 1.3% in Q3, an annualised rate of 5.3%. But the official q/q …
Could Egypt’s financing fears be set to ease? Reports over the past week have suggested that Egypt could be poised to leverage its position in the region to receive financial support in exchange for helping to de-escalate the Israel-Hamas conflict . …
19th October 2023
We set out our initial thoughts on the potential implications of the conflict between Israel and Hamas earlier this week here . It’s hard to know how things will develop from here, but we think that there are four key points worth making at this stage. …
13th October 2023
Online briefing about the health of China's economy We'll be online on Wednesday shortly after the release of the September activity and spending data and Q3 GDP. Register here to join us. US export controls about to bite harder The US government is on …
Investment growth may have slowed in Q3 Data released this week showed that growth in industrial output accelerated from 6.0% y/y in July to 10.3% y/y in August, the fastest in more than a year. And in m/m seasonally adjusted terms, output rose from 0.2% …
The outbreak of conflict between Hamas and Israel this week has not yet spilled over into the wider region. But the situation is in flux and, if Iran is pulled into direct conflict, the ramifications for the region would be a lot larger. Since we …
12th October 2023
Turkey: rebalancing now underway Data releases this week finally provided some signs that Turkey’s inflation and current account problems are starting to ease. Admittedly, inflation continued to rise in September, to 61.5% y/y, from 58.9% in August. But …
6th October 2023
Limited macro fallout from weakening rupee The sell-off in global bond markets has caused currencies, including the rupee, to come under pressure this week. The rupee is now at 83.2/$, hovering close to record lows. It could even have posted new lows but, …
PBOC not letting its guard down The yield on 10-year US Treasuries surged to a 16-year high this week. We covered the potential implications for the global economy here . But one of the more immediate consequences has been downward pressure on many EM …
Al-Sisi confirms his running; UAE opens swap line Egypt’s incumbent President al-Sisi has confirmed he will run for re-election in December in a race that he is almost certain to win. The policy paralysis induced by this election has prompted central …
5th October 2023
SA's avian flu outbreak unlikely to sway the SARB South Africa is in the midst of a severe avian flu outbreak which, coming alongside the effects of loadshedding, has prompted fears of shortages and higher prices for eggs and chicken meat. But this is …
29th September 2023
MNB and CNB continuing to toe a hawkish line The Hungarian and Czech central banks maintained fairly hawkish communications at their meetings this week, but we still think that interest rates will fall sharply in both countries by mid-2024. The Hungarian …
Industrial policy isn't an offset for property downturn Can emerging new industries replace property as a driver of China’s economy? There has been a flurry of discussion in the past couple of weeks in China about whether “new-type industrialisation” …
Coal stocks already at their lowest levels this year Workers affiliated with five trade unions at the state-owned behemoth Coal India are due to go on strike for three days next week (3 rd –5 th October) in dispute over wages. There is still time for the …
Will December’s election pave way for EGP move? Egypt’s National Election Authority confirmed this week that the presidential election will take place in December. As we highlighted , this adds to reasons to think the shift to orthodoxy will remain on …
28th September 2023
Brazil’s services inflation: how soft? The big economic event this week was the central bank meeting in Brazil on Wednesday at which the Selic rate was lowered by another 50bp (to 12.75%). As we noted in our response , the key messages in the statement …
22nd September 2023
Poland-Ukraine relations show some cracks The dispute that escalated this week between Poland and Ukraine shows how Poland’s ruling PiS party is hoping to capitalise on nationalism, and public fatigue over the war, ahead of elections next month. Poland, …
Efforts to boost foreign investment are failing In March, the government launched a year-long “Invest in China” campaign to shore up sagging foreign investment. As part of these efforts, it set out 24 measures in August to improve the business environment …
Gov’t achieves long-stated aim of bond inclusion Almost a year on from a high-profile snub , JP Morgan announced on Friday that it would be including Indian local-currency bonds in its GBI-EM Global Diversified Index for the first time. Inclusion will …
Is Egypt set for the polls before year-end? Reports that Egypt’s presidential election, originally scheduled for 2024, could be held before the end of this year may help to explain the recent policy paralysis with regards to the pound. The National …
21st September 2023
Argentina: Devaluation triggers inflation jump This week’s inflation data from Argentina made for a grim reading. Consumer prices rose by 12.4% m/m in August on the back of last month’s devaluation , pushing inflation to 124% y/y – the highest rate since …
15th September 2023
Russia seeking closer friendship with North Korea The strengthening relationship between President Putin and North Korean leader Kim Jong Un was on show this week but we doubt the discussions will yield any meaningful benefits for Russia’s economy or …
Property controls have been substantively relaxed in recent weeks. The big announcements came on the last day of August. But there has since been plenty of easing at the local level too. At least ten large cities have lifted all home purchase …
G20 summit exceeds low expectations T he G20 managed to deliver a joint statement at its summit in New Delhi, which was deemed as something of a foreign policy triumph for Prime Minister Modi given the uncertainty ahead of the event. This owed much to …
All eyes on the CBE The Central Bank of Egypt (CBE) resumed its tightening cycle in August and, with inflation rising further, we expect interest rates to be hiked again. More than anything, though, investors will be looking for any shift in the exchange …
14th September 2023
Sheinbaum follows in Amlo’s footsteps Former Mexico City mayor Claudia Sheinbaum was unveiled as the ruling Morena party’s presidential candidate this week and with her facing off against the main opposition candidate Xóchitl Gálvez in next June’s …
8th September 2023
The decision by the National Bank of Poland (NBP) to kick off its easing cycle this week with a much larger-than-expected 75bp interest rate cut has been heavily criticised, and suggests to us that policymakers are underestimating the challenge of …
Geopolitics loom large over New Delhi showcase Following the success of the Chandrayaan-3 mission to the south pole of the moon in August, this weekend’s G20 summit in New Delhi will undoubtedly be presented as another foreign policy triumph by the BJP as …
Huawei's chip breakthrough The launch of Huawei’s new phone, the Mate 60 Pro, has sparked a debate over the effectiveness of US export controls that were tightened last year, restricting the sale to China of machinery needed to produce sub-18nm chips. The …
Saudi oil output cut rollover a significant GDP hit Earlier this week Saudi Arabia confirmed that it will extend its additional voluntary 1mn bpd oil output cut until the end of this year which will result in a significant hit to economic growth this …
7th September 2023
IMF losing its patience with Argentina The IMF’s fifth and sixth reviews (which were combined) of Argentina’s $44bn programme out late last Friday make for pretty depressing reading. The Fund slashed its 2023 GDP growth forecast to -2.5% (from +2%) and …
1st September 2023
Rising gas prices doesn’t mean energy crisis is back Wholesale European natural gas prices jumped more than 20% in the early part of this week and have been highly volatile recently, but this doesn’t mean the energy crisis in the region is coming back to …
Vegetable price inflation still elevated The surge in tomato prices since early July has gone into reverse over the past couple of weeks and prices are now close to their levels from June. (See Chart 1.) This has been mostly due to improvements in supply …
Stimulus efforts are finally gaining momentum. Yesterday, regulators announced measures to support households and shore up the property sector, including looser downpayment requirements and reductions to existing mortgage rates. And today, the state banks …
What’s driving the slide in SAMA’s assets? The drop in the Saudi Central Bank’s (SAMA) foreign assets to a 14-year low in July caused some concern this week, but we suspect this reflects funds being recycled to the Public Investment Fund. Figures …
31st August 2023
Drought takes its toll on the Panama Canal Panama is the latest victim of climate change in the region. The country is reeling from a drought with “no historical precedence” according to Panamanian authorities, which has seen water levels at the Gatun …
25th August 2023
CBRT policy shift now firmly back on track There’s a lot of confusion about what drove Turkey’s central bank to deliver an unexpected 750bp rate hike this week and doubts remain about the policy U-turn. But at this point we’re minded to focus on the …
BRICS expansion unlikely to challenge G7 India made history this week after its Chandrayaan-3 mission became the first to touch down on the south pole of the moon. Remaining column inches in the local press have been given to the BRICS summit in …
Time for a new acronym Earlier today it was confirmed that Saudi Arabia, the UAE, Egypt, Iran, Argentina, and Ethiopia were all being invited to join the BRICS bloc and, while this is unlikely to have major economic effects in the near term, the possible …
24th August 2023
Argentina: PASO vote triggers more chaos Last Sunday’s presidential primary election in Argentina (known as the PASO) sent the economy deeper into crisis. Although the results probably portend a shift to the right (and more investor-friendly …
18th August 2023
Russia’s macro foundations now being shaken Macroeconomic stability risks started to crystallise in Russia this week. The ruble slumped and the central bank intervened with an emergency interest rate hike. Policymakers are clearly considering further …
