Filtered by Region: Emerging Markets Use setting Emerging Markets
Saudi and Russia add to bearish oil tone Saudi Arabia announced that it will extend its voluntary 1mn bpd oil output cut at least one more month, which came along with the news that Russia plans to cut exports by 500,000bpd too. The decision to roll over …
6th July 2023
Putin cracking down following the rebellion The aborted uprising by Yevgeny Prigozhin against Russia’s military last weekend has prompted a forceful response by President Putin to reassert his authority. There’s much less certainty about the implications …
30th June 2023
Kenya: Thugge makes his mark Kenya’s central bank hiked interest rates by 100bp, to 10.50%, at an unscheduled meeting this week. The move was pinned on an increase in inflation in May, but more than anything it seems to be a strong attempt by new governor …
Price spikes won’t boost inflation yet Near-term inflation dynamics in India are largely driven by food prices, which account for almost half of the CPI basket. Concerns over a pick-up in food prices have been growing in recent days. The minutes of the …
Egypt’s path to largest MENA economy by 2050 In an Emerging Markets Update published this week, we highlighted which EMs will rise up the global league table. Within MENA, Egypt’s economy will take Saudi Arabia’s crown as the region’s largest economy by …
28th June 2023
BRL rally for real? The Brazilian real’s recent rich vein of form has continued this week, with the currency appreciating by a further 1.5% against the dollar, to 4.8/$. Several factors have supported this, including improvements in Brazil’s trade balance …
23rd June 2023
Indian manufacturing to benefit by leaning to US The sweeping agreements on trade and defence announced during Narendra Modi’s state visit to the US this week underline that India’s government and firms increasingly see their interests as favouring …
A cut, a hold .... and an underwhelming hike The three central bank meetings that took place across the region this week all produced different outcomes, and policymakers’ communications suggest interest rates in these countries will continue to move in …
Zambia secures deal with official creditors This week saw Zambia edge closer to getting a debt restructuring over the line, but an agreement with official creditors suggested that there remain sticking points when it comes to negotiations with China. …
Egypt: fiscal policy on right path, but not yet for EGP The key message from the briefing that we attended with Egypt’s Finance Minister Mohamed Maait in London last Friday was the government’s commitment to tight fiscal policy and that a devaluation is …
22nd June 2023
This week’s plunge in the Nigerian naira marked the latest positive step by President Bola Tinubu as he seeks to overhaul the economy, but there are still plenty of reasons to be cautious that this policy shift marks a clean break from the Buhari-era. A …
16th June 2023
Brazil: shifting towards rate cuts? Expectations for interest rate cuts in Brazil have grown in light of recent developments, but, for now, we’re sticking with our view that Copom will hold off on lowering interest rates until November. The arguments in …
PiS adding further fuel to the inflation fire The Polish government set out plans this week to increase the national minimum wage by around 20% again next year. With the labour market still very tight and further pre-election fiscal stimulus likely to be …
Note: We’re talking inflation and the BOJ, slowing Indian growth, and regional monetary easing in our Asia Drop-In on Thursday, 22nd June. Register now . Latest inflation data support our rates cuts view The overarching message from our Q3 India Economic …
Could SAMA step in again to support credit growth? Interbank rates in Saudi Arabia are running at their highest since 2001 following the monetary policy tightening over the past year or so and, with lingering concerns over the banking sectors liquidity, …
15th June 2023
Petro crisis sparks rally in Colombian assets Colombia stumbles from political crisis to political crisis. After a major cabinet reshuffle in April, this week’s scandal included allegations of phone tapping and violation of campaign financing rules and …
9th June 2023
Agriculture dampened SA growth in Q1 South Africa’s Q1 GDP figures released this week revealed a big drag from the agricultural sector. Some of the factors that weighed on output (namely the weather) are likely to prove temporary but, even so, confidence …
Turkey embraces orthodoxy, but for how long? Optimism about a shift towards orthodox economic policymaking was at the heart of developments in Turkey this week amid the appointments of a new cabinet and central bank governor and a sharp fall in the lira. …
RBI hawkish, but inflation outlook improving The Reserve Bank of India (RBI) didn’t throw up any surprises when it kept the repo rate on hold at 6.50% this week. The move was widely expected and the muted reaction in local financial markets suggests that …
Is Saudi Arabia taking its eye off the ball? Outside of the usual economics newsflow this week, Saudi Arabia has been the hot topic in the footballing and golfing world. It was announced control of four Saudi Pro League clubs is being transferred to the …
8th June 2023
Colombia: baby steps towards sustainable growth Data out this week suggest that Colombia’s economy has started to undergo an adjustment process, albeit a gradual one. In an Update last week, we explained how Colombia’s unsustainably strong recovery had …
2nd June 2023
Optimism building about policy shift in Turkey All the attention in Turkey this week has been on whether President Erdogan will moderate his economic policies now that he has secured another five-year term. The latest signs of an improvement in …
Revising up our GDP forecast for 2023 The activity data released this week suggest that the economy is holding up better than we had been anticipating. GDP growth accelerated from 4.5% y/y in Q4 2022 to 6.1% y/y in Q1 (Q4 of FY22/23). Based on our …
All eyes on OPEC+ Sunday’s OPEC+ meeting is going to be a closely watched affair amid speculation that Saudi Arabia will push for another oil output cut. Our expectation is that OPEC+ will stick with current output quotas. (Listen to an on-demand …
1st June 2023
Attention focusing on financial stability in Turkey With the second round vote of Turkey’s presidential election taking centre stage on Sunday, the day of reckoning for Turkey’s economy and financial markets may now just be around the corner. The …
26th May 2023
Slow progress tackling construction backlog New home sales have ticked up since the end of last year, helped by a post-zero-COVID recovery in consumer confidence and large reductions in mortgage rates and down-payment requirements. But the improvement has …
Tunisia’s central bank independence under fire A new wave of reforms supposedly laid out by Tunisia’s President Saied’s have taken aim at the central bank’s (BCT’s) mandate which could result in it being used for unorthodox measures. That would …
25th May 2023
Erdogan in pole position for the presidency Sunday’s presidential election result in Turkey was all about Erdogan. He gained more than 49% of the vote share after some of the more reliable polls last week had opposition candidate Kemel Kilicdaroglu at …
19th May 2023
Egypt stepping up reforms to attract investments The first privatisation deal in nearly a year took place in Egypt this week and the prime minister outlined fresh steps to overhaul the business environment, but loosening the central bank’s grip on the …
18th May 2023
An underwhelming set of data published over the past week have added to growing concerns about the state of China’s recovery. Imports , inflation and credit all came in below expectations for April. It might seem hard to square this with the more …
12th May 2023
Czech government tightens the purse strings The Czech government’s long-awaited fiscal consolidation package this week will include fiscal tightening of around 1.5% of GDP over 2024/25 which will come at the cost of weaker growth. But this appears to be a …
Egypt’s make or break moment This week saw positive news in Egypt regarding the public finances and the privatisation drive. But next week’s MPC meeting will prove critical as to whether policymakers can get out of the economic crisis. Finance Minister …
11th May 2023
Note: We’ll be discussing the economic and market risks around the upcoming Turkish presidential and parliamentary elections on at 09:00 EDT/14:00 BST on 10 th May . Register now. Turkey’s election race heats up Opinion polls are now painting a clearer …
5th May 2023
Note: We’re holding a special 20-minute online briefing all about EM debt risks this Thursday at 10:00 EDT/15:00 BST . Register now . Oil prices: “Don’t get cocky OPEC+” The price of oil has dropped sharply this week on fears about the health of the …
4th May 2023
Property policy recalibration The Politburo held its monthly meeting today and, as is usual in April, its focus was the economy. The gist of its statement is one we’d agree with: economic growth in the immediate rebound from zero-COVID weakness “has been …
28th April 2023
CEE edges closer towards monetary easing Central banks across Central and Eastern Europe (CEE) provided firmer signs this week that, with inflation now declining , monetary loosening may soon be on the cards. But there are still clearly big concerns that …
Fall in the rupee this year likely to be limited The rupee is up by around 1% against the US dollar so far this year, leaving it in the middle of the pack among other EM currencies. (See Chart 1.) Chart 1: Currencies vs. US$ (% change, YTD) Sources: …
With Egyptian policymakers dawdling on the IMF’s reform demand, pressure is growing for another devaluation of the pound and investors are increasingly fearing that a sovereign default could follow. For now at least, there is still a path out of the …
27th April 2023
Door remains ajar for further tightening… The minutes of the MPC’s April meeting – in which the committee voted unanimously to keep the repo rate on hold (at 6.50%) for the first time in a year – were published this week. While it has been clear for some …
21st April 2023
Aramco transfer accelerates under Vision 2030 plan Saudi Arabia’s government transferred a further 4% of Aramco to the Public Investment Fund (PIF) this week as part of its efforts to diversify its revenues away from oil as part of Vision 2030. But there …
20th April 2023
Note: Join our Tuesday 18 th April online briefing discussing what China’s Q1 “data dump” tells us about the strength of the country’s reopening recovery. Register Now . The rebound has exceeded most expectations Mixed data have contributed to differences …
14th April 2023
Inflation nearing a peak but devaluation fears linger Egyptian inflation rose to its fastest pace since mid-2017 in March and, while there are signs it could be nearing its peak, mounting pressure on the pound presents a clear upside risk. Data released …
13th April 2023
Raising exports to US$2trn by 2030 a tough task This week marked the start of the government’s new Foreign Trade Policy (FTP). While previous FTPs have had a five-year span and have typically focussed on financial incentives for exporters such as …
6th April 2023
CEE remains in recession in Q1 The batch of hard activity data and surveys released across Central Europe this week were relatively weak and suggest that GDP contracted in most economies again in Q1. We think the regional downturn will stabilise in Q2, …
Infrastructure boosting construction activity The shape of China’s post-zero-COVID rebound has become clearer over the past week: primarily services-driven, as expected, but with stronger construction activity too, which appears to be mostly about …
Israel’s legal reforms spark constitutional crisis Israel’s political crisis that flared up earlier this week has since calmed down after PM Netanyahu paused the government’s controversial judicial reforms. While tensions may flare up again and Israel’s …
31st March 2023
Note: Join our 6 th April online briefing all about the risks to EMs from banking turmoil. Register now . Central banks re-upping the pace of tightening Central banks in South Africa, Kenya and Ghana all delivered more aggressive interest rate hikes this …
Note: Join our 6th April online briefing all about the risks to EMs from banking turmoil. Register now . Rosneft, IOC deal will keep Russian oil flowing We’ve made the case in much of our research that, in an increasingly fractured global economy that …
Note: Join our 6 th April online briefing all about the risks to EMs from banking turmoil. Register now . H2-oh… Droughts in the Middle East and North Africa are becoming more frequent and more severe, with Morocco and Tunisia experiencing them right now. …
30th March 2023
SARB to follow CBN in delivering dovish hike Nigeria’s central bank shrugged off the recent banking sector turmoil and kept its eye firmly focussed on tackling inflation as it hiked interest rates this week and, on balance, we think the South African …
24th March 2023
