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Country Insights

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Coronavirus: Turbulence in relationship with China; most are in favor of social distancing
BRAZIL POLITICS - Report 06 Apr 2020
There was added tension in the Brazil-China relationship today (06) after the Minister of Education, Abraham Weintraub, used Twitter to post insinuations that China could purposefully benefit from the global crisis caused by the coronavirus. According to the minister, China’s goal is to “take ove...

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Economics: Recalculating for oil and Covid-19
MEXICO - Report 06 Apr 2020
Mexico has experienced five economic contractions over the past four decades including the slippage seen in 2019, but while the first four of these recessionary episodes led to a recovery the following year, it will be a very different story this time around. Even before the pandemic and oil war ...

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Politics: Ambiguous, erratic handling of Covid-19
MEXICO - Report 06 Apr 2020
Time will tell whether or not the results of the Mexican government’s unique coronavirus strategy, which relies on disease modeling combined with highly selective testing and targeted responses, will deliver positive results or something more akin to Italy’s nightmare. However, its implementation...

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AMLO LOOSES GRASP OF ECONOMIC REALITY
MEXICO - In Brief 06 Apr 2020
AMLO insists on distancing his government economically (and politically), from the last five administrations (Salinas, Zedillo, Fox, Calderón and Peña Nieto), even though this translates into ineffective solutions to Mexico’s main challenges:a significant recession due to COVID 19 and pubic finan...

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Synthesis of the Brazilian economy
BRAZIL ECONOMICS - Report 06 Apr 2020
The new coronavirus has already infected at least 1.2 million people in the world, with 64 thousand deaths and 244 thousand people classified as recovered, according to data up to April 4th. The numbers are imprecise due to the different testing strategies adopted in countries and regions. China,...

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With a slight correction : Rates reduced to 0.1%
ISRAEL - In Brief 06 Apr 2020
The MPC decided to reduce rates to 0.1%, and in addition to provide 3 year loans to the banks at 0.1% interest, contingent on providing loans to small and medium sized businesses. In addition, the BoI will allow corporate bonds (in addition to government bonds) as collateral in the repo market. T...

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Another official statement on fiscal measures arrived this morning
HUNGARY - In Brief 06 Apr 2020
Just as promised a few days ago, PM Orbán made another statement on further details of the upcoming Covid-19 fiscal action plan. Following the logic of the new extraordinary legal rule, under which the cabinet can govern the country by issuing decrees during the existing emergency situation, he m...

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Institutional tension may increase
BRAZIL POLITICS - Report 06 Apr 2020
Governors may ask for an extension of social isolation measures. President Bolsonaro has stated that, if the gradual lifting of measures is not announced, he may decide the matter. The Senate may vote on the Constitutional Amendment proposal that deals with the “wartime budget”. The Lower House m...

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Compulsory restructuring of the debt under local law
ARGENTINA - In Brief 06 Apr 2020
This morning, the government published a Decree that postpones, until the last day of 2020, payments (interest and amortizations) on the debt denominated in US dollars contracted under Argentinean law. It is the beginning of the process of compulsory restructuring of that debt that we had anticip...

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Policy rates reduced to 0.1%, with further loosening possible
ISRAEL - In Brief 06 Apr 2020
The MPC decided to reduce rates to 0.1%, and in addition to provide 3 year loans to the banks at 0.1% interest, contingent on providing loans to small and medium sized businesses. In addition, the BoI will allow corporate bonds (in addition to government bonds) as collateral in the repo market. T...

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​Process for postponing elections begins as contagion and dismissals grow
DOMINICAN REPUBLIC - In Brief 06 Apr 2020
The Ministry of Public Health confirmed that until last Saturday (April 4) a total of 1,745 people has been diagnosed with Covid-19. 53% of all cases have been registered in the Greater Santo Domingo area. Of the total number of people diagnosed, 82 have died, 17 have recovered and the rest conti...

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Foreign debt issues will take some pressure off domestic yields
ISRAEL - Report 06 Apr 2020
The spread of the coronavirus in Israel appears to be slowing in recent days. The MoF announced a fairly modest fiscal stimulus scheme with actual expenditure growth of 2.5% GDP. We think the fiscal deficit will reach 8% GDP this year; financing this deficit will be facilitated by issuance abroa...

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Mitigation efforts in times of coronavirus
PERU - Report 06 Apr 2020
The Peruvian government was among the first in the region to order stringent social distancing measures, despite a relatively low number of cases at the time. As of April 4th, only 17,841 tests had been applied, 1,746 people had tested positive and 73 people had died. The number of cases is expec...

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Negative comments diminish hopes for a new OPEC+ deal
GULF COUNTRIES - In Brief 05 Apr 2020
There have been new developments, both positive and negative, over the weekend on the prospects for a renewed (and greatly expanded) OPEC+ deal. The market may start to take a view on this early in the week, possibly as soon as Asian trading opens on Monday, with the potential for a significant i...

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Foreign debt issues will take some pressure off domestic yields
ISRAEL - In Brief 05 Apr 2020
The Employment Agency continues to report an increase in the demand for unemployment benefits, reaching 880 thousand (including forced unpaid vacation). This represents 25% of the labour force. The MoF announce a modest fiscal stimulus package of 80bn (5.5% GDP). Only about 2.5% (35bn ILS) are ex...