Country Insights

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President suggests Smoliy as replacement to Hontareva
UKRAINE - In Brief 18 Jan 2018
President Poroshenko finally made his decision about new Head of the National bank of Ukraine. Today he suggested for this position Ykiv Smoliy, currently acting Head of the National bank. Previously observers discussed Volodymyr Lavrenchuk (Chairman of the Boar...

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New privatization law approved
UKRAINE - In Brief 18 Jan 2018
Today parliament finally approved new law on privatization. This law is among the IMF requirements. The key features of the law include (a) introduction of independent investment advisors that accompany sale of large state owned enterprises, (b) sale of small st...

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Golden Scenario To Run Until End-2019, Sort Of
HUNGARY - Forecast 18 Jan 2018
Our new quarterly forecast marks an unusually smooth macroeconomic path for Hungary in 2018-2019. This should come about with annual real GDP growth above 3%, relatively low, though rising, inflation, a material, though shrinking, external income surplus, and a ...

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The Reserve Bank opts to Keep Interest Rates Unchanged Amid Credit Rating Uncertainties
SOUTH AFRICA - Report 18 Jan 2018
The South African Reserve Bank’s Governor Lesetja Kganyago has announced today that the MPC has voted in favour of leaving the repo rate unchanged at 6.75 and therefore the prime interest rate at 10.25. The Reserve Bank MPC’s decision to not change interest r...

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In a stupor
VENEZUELA - Report 18 Jan 2018
Hyperinflation is an unprecedented experience in Venezuela. The population is quickly moving from stupor and bewilderment to a frantic search for survival tools. Inflation accelerates dramatically as demand for money collapses, money supply surges and shortages ...

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MPC: No Action, Somewhat More Hawkish
TURKEY - Report 18 Jan 2018
​In line with the consensus, the CBRT’s Monetary Policy Committee (MPC) did not change any of the short-term interest rates at today’s meeting, keeping the Late Liquidity Window lending rate at 12.75%, one-week repo rate at 8.0%, and the O/N lending and borrowin...

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New ANC President Cyril Ramaphosa Injects Some Optimism into the South African Economy
SOUTH AFRICA - Forecast 17 Jan 2018
South Africa’s Growth: The South African economy has managed to grow at a relatively decent rate (2.0%) during the third quarter of 2017, following the surprise 2.8% growth in the second. Generally, however, the country’s economic growth has been stuck in low ge...

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Stronger than expected opposition downplays growth optimism
ARGENTINA - Report 16 Jan 2018 1 response
Negotiations with governors and trade union leaders during November and discussions in Congress during December proved to be more difficult than anticipated in our previous quarterly report.​ Several desirable features of the tax and labor reforms had to be a...

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Politics: 2018 Campaign Entering Critical Phase
MEXICO - Report 15 Jan 2018
As the three coalitions embark on the final month of the preliminary phase of the presidential race, in which they are using the nomination contests -whose outcomes have been a foregone conclusion for some time- to get their candidates better known and polish th...

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Economics: Taking Stock and Looking Ahead
MEXICO - Report 15 Jan 2018
We look for the Mexican economy to essentially sustain its 2017 pace of growth in the coming year and by sector for services to remain the main motor force. We project the agricultural sector to step up its pace of growth and manufacturing to serve as the strong...

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Erdogan serious about entering Afrin
TURKEY - In Brief 15 Jan 2018
President Erdogan proclaimed in the most emphatic tones used heretofore that a military operation could commence to purge Kurdish-held Afrin canton and Manbij district of Syria from terror “any minute”. Indeed, Turkish press reports massive force build-up at the...

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Week of January 15
BRAZIL POLITICS - Report 15 Jan 2018
President Michel Temer has until Friday (January 19) to answer questions from the Federal Police on supposed irregularities in the drafting of a decree that benefited companies from the ports sector. The impasse regarding the appointment of Rep. Cristiane Brasil...

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Has the bond market arrived?
INDIA - Report 15 Jan 2018
Bank credit to the private sector has grown slowly with the slow realisation by banks and their regulator that there is a serious banking crisis at hand. A natural channel that may get exploited, with inadequate bank lending, is bond market financing. This is pa...

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Monetary and Fiscal Policy: What Corrections Are Necessary?
BRAZIL ECONOMICS - Report 15 Jan 2018
​While monetary policy is being rewarded by the sharp fall of inflation and clear anchoring of expectations, allowing the interest rate to be reduced to a level that stimulates economic recovery, the perspectives for fiscal policy are alarming. Granted, advances...

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Some things to watch for in 2018: Part Two
CHINA FINANCIAL - Report 15 Jan 2018
Special points to highlight in this issue: * For all the discussion about enforcing market discipline by eliminating explicit or implicit government guarantees on local-government and corporate borrowings, any credible reintroduction of credit risk is likely ...