Country Insights

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Q2 GDP data shows continued robust growth, with some confusion caused among analysts
HUNGARY - Note 16 Aug 2017
Real GDP growth for Q2 was reported at 3.6% yoy on sda basis, just slightly down from 3.8% in Q1, this morning. This was above the otherwise nicely accelerating 2.2% yoy growth recorded in the Euro Area, but lower than the yoy growth figures reported for most of...

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Fiscal policy
BRAZIL POLITICS - Market Brief 16 Aug 2017
The government announced on August 15 the new fiscal targets for 2017 (from a deficit of R$ 139 billion to R$ 159 billion) and 2018 (from R$ 129 billion to R$ 159 billion), in addition to measures that aim to reduce spending, including the postponement (for one ...

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Same Old Same Old
PHILIPPINES - Quarterly Outlook 15 Aug 2017
The President’s second State of the Nation Address (SONA) in July suggests that year 2 of the Duterte Administration will be much like year 1. Our central growth scenario of 6.5% in 2017 and 6.3% in 2018 is unchanged from our last report, although we now expect...

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Week of August 14
BRAZIL POLITICS - Weekly Trends 14 Aug 2017
The government is expected to announce the new fiscal targets for 2017 and 2018, aside from a set of measures to contain spending on civil servants. In the Lower House, we highlight the analysis of Political Reform. Even without an agreement, the provisional mea...

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​A better than expected tie with improved political outlook
ARGENTINA - Market Brief 14 Aug 2017
Cambiemos (Macri’s governing coalition) managed a somewhat better than expected result in the primary election for senator in the province of Buenos Aires. This is quite an achievement considering that the relatively unknown Esteban Bullrich competed against pol...

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Monetizing debt does not relieve China’s debt burden
CHINA FINANCIAL - Monthly Report 14 Aug 2017
Special points to highlight in this issue: • China’s GDP was 11.4 percent greater in the first half of 2017 than it was in the first half of 2016, and 6.9 percent greater at comparable prices, implying a GDP deflator of 4.2 percent. This is broadly in line wit...

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Economics: EM Outlook Firms, but Trouble Lurks
MEXICO - Weekly Trends 14 Aug 2017
The election of a new US president in November initially had a markedly adverse effect on most emerging economies, which had already been rocked by two years of depressed commodity prices, sluggish-to-negative growth and stressed public finances. Mexico was a...

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Revisiting foreign exchange flows and stocks
VENEZUELA - Market Brief 14 Aug 2017
Financial tensions are on the rise. This year's forex cash flow deficit seems manageable, owing to sharp import cuts, but downside risks prevail. Pdvsa’s output declines and prices are volatile. Access to new funds in the international financial markets becomes ...

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Falling Inflation and Continuation of Monetary Easing
BRAZIL ECONOMICS - Market Brief 14 Aug 2017
The increase of 0.24% in the June IPCA exceeded the market consensus by 6 basis points, but the rise was all explained by the change in the electricity rate flag (from green to yellow) and the increase in the tax on fuels. All the same, inflation over the previo...

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No Miracles
RUSSIA POLITICS - Monthly Report 11 Aug 2017
The Russian leadership was extremely disappointed with the recent turn of the US–Russia relations. Despite a productive presidential meeting, the congressional decision to increase sanctions was clear evidence of no positive change to be expected any time soon. ...

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Politics: BOF Efforts Intensify, But Pitfalls Remain
MEXICO - Weekly Trends 11 Aug 2017
As the incumbent PRI considers new ground rules for its presidential selection process, and that of Morena was always a foregone conclusion, PAN and PRD leaders have been stepping up efforts to establish what they have billed as a Broad Opposition Front (BOF) th...

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Corruption and Political Crisis Threaten Economic Recovery
ECUADOR - Monthly Report 11 Aug 2017 1 response
The internal crisis in the governing Alianza Pais has ballooned into a government and national political crisis that is threatening President Lenín Moreno’s already-difficult plan to lead Ecuador to economic recovery. The roots of the crisis are twofold. The ...

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Real GDP growth declines to 4% in H1
DOMINICAN REPUBLIC - Note 09 Aug 2017
The Central Bank released data that reveals a noticeable contraction in economic activity in H1. The Monthly Indicator of Economic Activity (IMAE, for its Spanish acronym) set real GDP rate of growth at 4%, below its potential. In H1 2016, GDP growth was estimat...

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Buoyant P/E ratio, buoyant earnings growth?
INDIA - Special Report 09 Aug 2017
Fine points in the handling of firm data do matter. It appears easy and expedient to use the Nifty market capitalization time series and the Nifty P/E ratio time series to back out an estimate of Nifty earnings time series. While many finance practitioners do th...

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Inflation nearing 30% in August
VENEZUELA - Market Brief 09 Aug 2017
Runaway monetary expansion and the steep increase of the price of the dollar in the parallel market continues driving prices upwards. Officially approved price increases in July contributed to inflation while also helping alleviate shortages of some goods. Howev...