According to the quarterly bulletin of the South African Reserve Bank (SARB), the deficit on the current account narrowed in the first quarter of 2013, an indication of a resurgence in export activity. Consequently, the ratio of the current account balance to the gross domestic product was -5.8% in ...

The Monetary Policy Committee left all rates as well as all other levers of monetary policy (reserve ratios, ROCs, etc.) untouched, exactly in line with the consensus. The statement was also the plainest we’ve read in a long time....

A series of demonstrations that began in São Paulo last week, originally against the readjustment of bus fares, is growing in size as it spreads across the country. On Monday night, according to the Datafolha Institute, about 65,000 people attended the demonstration in Brasilia. In Rio de Janeiro, an ...

The data for the first quarter of 2013 show that the deceleration of GDP growth came from slower growth of household consumption and increased net imports. The positive surprise was fixed capital investments. The monthly figures on production of capital goods and construction materials, and the quantity ...

Just two weeks after the government announced much-better-than-expected 7.8% GDP growth in 1Q2013, which bucked the regional growth slowdown, local stock prices grabbed headlines with the worst one-day dive since the Lehman crisis in October 2008. Many were stunned by the steep fall, especially following ...

The setback in headline inflation sentiment index can largely be explained by increasing erosion of consumer expectations. That signals that consumer spending will stay weak through Q2. Flagging consumer hopes for household finances, and the broader economy, will evolve over the next year. Last week’s ...

The seasonally adjusted retail sales numbers for April show slightly stronger growth: in the restricted concept sales grew 0.5% and in the augmented concept (including cars and construction materials) they expanded 1.9%. Over the past 12 months through April, the rates are lower than in 2012, with restricted ...

Two important data prints were released today: GDP grew by a better-than expected 3% in Q1, y/y, while April current account deficit was a wider than expected $8.2 billion. Both prints are problematic in our view, as they yield signs of a struggling economy on two fronts: a not so healthy growth dynamics ...

A favorable performance of the South African manufacturing sector is indispensable for achieving robust and sustained domestic economic growth. This is evidenced by the fact that a poor performance of the domestic manufacturing sector largely contributed to a shocking Q1 2013 gross domestic growth outcome....

For the last decade, financial reforms in India have floundered. The game plan that now seems to be clearly visible comprises of a long term strategy and a two-pronged short term strategy. The long-term strategy is to enact some version of the draft Indian Financial Code, a new law that will replace ...

Appreciation of the parallel exchange rate, and a temporary fall in inflation, have moderated economic instability. But inflation and FX dynamics were mostly driven by unsustainable price controls, aggressive FX intervention in the blue-chip swap, and monetary contraction, bolstered by seasonal factors....

The weak economic growth and expansionary fiscal policy that have raised the risks of dangerous growth of the public debt were responsible for the change in the Brazilian outlook from stable to negative by S&P. In addition to the decline in the primary surplus of the central government, which was evident ...

Concern over inflation has led the Central Bank to signal a more intense monetary tightening cycle is in store, with the yield curve last week indicating the cycle might end with the SELIC rate at 9.25%. The high inflation is being driven by the steep increase in absorption in proportion to GDP and ...

All the Cards are on the Table: Governing Party has a chosen One. According to the two main polls in Panama, Ditcher & Neira and IPSOS, as of May 2013, there has been a significant change in the political scenario; however, both polls reflect such change in a somewhat different perspective. According ...

One of the lowest rates in 10 years, Q1 growth came in far below expectations at just 0.3% y/y. Nearly every field shrank: local manufacturing, construction, commerce, hotels, bars and restaurants, and energy and water. The collapse was the result of falling domestic demand, both due to the recent tax ...

S&P announced a change in Brazil’s outlook from stable to negative. The decision was based on the fact that, in the absence of corrective measures, the weak GDP growth combined with a continually expansionary fiscal policy (including off-budget measures) generates the risk of weakening the country’s ...

Vladislav Surkov’s resignation was a strong blow to Dmitry Medvedev, significantly decreasing his effectiveness as Prime Minister. An authoritative mastermind of the national political system, he remained efficient and influential even outside the presidential administration and was responsible for ...

Dissatisfied with the slowness of implementing his year-old decrees to raise salaries for a range of public employees, President Vladimir Putin met with members of his cabinet on May 7th, and asked them to speed up their efforts. Most initiatives involve extra government spending, to support salary ...

Turkey is going through an extraordinary upheaval of-- so far-- peaceful nature. Organized and galvanized by social media, the “modernist” face of Turkey is on the streets. Even though some steps by AKP reveal a softening of attitude, there is no sign that the party is ready to abandon any of its social ...

The Finance Ministry announced the elimination of the IOF (Tax on Financial Operations) on investments from abroad in the fixed-income market. The IOF rate had been raised from 2% to 4% on October 4, 2010, and then to 6% on October 18, 2010, staying there until today....

After accounting for seasonal factors, industrial output rose 1.8% in April, or 8.4% in relation to the same month in 2012. There were substantial increases in vehicles (8.2%); machinery and equipment (7.9%); and foods (4,8%), and the result for the month was very diffused, covering a large number of ...

In May, consumer prices rose by a lower than expected 0.15%, versus market expectations of around 0.4%, thanks to a somewhat deeper drop in food prices and a softer increase in transportation prices. But because of last year’s low base, the 12-month CPI inflation nevertheless edged up to 6.5% from ...

In assessing the reasons for the weak GDP performance in the first quarter, two points stand out. The first is the fall in the contribution of household consumption, which grew only 0.1%, and the second is the slower growth of GDP in the service sector, largely determined by the stagnation of financial ...

We had predicted a scorching hot summer in Friday’s Monthly Report, which proved prescient. AKP’s shortsightedness and atrocious police brutality turned a sit-in by 50 tree huggers to rescue the trees in Gezi Park (Taksim Square Promenade) into a nation-wide outburst. The self-imposed coverage ban ...

The politics section provides a preview of the summer, which promises to be the hottest in recent history as we find answers to 4 extremely critical questions. First, we expect the regional outlook to deteriorate into near-chaos after the failure of the Geneva talks. Secondly, Turkey and EU open a ...