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Sicad Methodology
VENEZUELA · Report · 16 Jul 2013

On Monday, July 15 in the afternoon, Armando León, member of the board of BCV, announced the methodology to be used to award forex in the Sicad auction on Wednesday, July 16. BCV will define a range (i.e., floor and ceiling). Bids that fall outside the range will be disqualified. Forex will be so...

An Opening Too Far
MEXICO · Report · 16 Jul 2013

Executive Summary Last week, Banco de México (Banxico) released its regularly scheduled review of monetary policy, in which the central bank left its overnight interbank lending rate at 4%. Banxico reaffirmed it is convinced that its current monetary policy is congruent with a scenario in which t...

Weekly Tracker: July 16-23
BRAZIL POLITICS · Report · 16 Jul 2013

The week begins with indecision regarding the congressional recess. According to the Constitution, to begin the recess, congressmen and senators must vote on the Budget Guidelines Law. However, the rapporteur believes that it will not be voted upon until August. The government may announce budget...

Concrete Results Urgently Needed
MEXICO · Report · 15 Jul 2013

Executive Summary This week we are dedicating our Political Outlook section entirely to the results of the most recent quarterly survey of voter opinion conducted by GEA-ISA, entitled “Mexico: Politics, society and change.” One of the most striking aspects of the most recent poll was the consider...

A Cooling Economy
BRAZIL ECONOMICS · Report · 15 Jul 2013

Three indicators point to cooling of the Brazilian economy: those for the labor market, industrial output and monthly GDP (IBC-Br). Brazil’s industrial production has not grown since 2010. The main reason for this stagnation is the rising unit labor cost. Despite clear signs of a weakening of the...

A Politics and Econ Update
TURKEY · Report · 12 Jul 2013

Executive Summary Recent actions by PM Erdogan and AKP give the impression that the party has parted ways with reality. A chief proponent of the ‘High Rates Lobby’ has been appointed Chief Advisor to PM, while the authorities have begun to investigate financial transactions to find corroborators ...

Retail Sales (May 2013)
BRAZIL ECONOMICS · Report · 11 Jul 2013

In May, retail sales in the restricted concept remained stable, but in the augmented sense (including cars and construction materials) there was a decline of 0.8%. In relation to May last year, the respective variations were 4.5% and 4.4% (Graph 1). Graph 1 Retail Sales – 12-month variation Among...

Midyear Brief
VENEZUELA · Report · 10 Jul 2013

Dialogue with the private sector is President Maduro’s most important public policy initiative so far, seeking to identify and resolve the most critical obstacles to local production. Hostility has given way to a rather relaxed exchange of views. The short list of urgent matters includes access t...

Political Weakness and Economic Mismanagement
BRAZIL ECONOMICS · Report · 10 Jul 2013

Executive Summary The perspectives for the Brazilian economy have taken a turn for the worse. The most optimistic projections for 2013 are for GDP growth below 2.5% (though still above 2%); inflation near (or slightly above) 6%; and the SELIC rate at 9.5% or 10%. The picture is further worsened b...

Construction and Public Policy
MEXICO · Report · 09 Jul 2013

Executive Summary Last week officials released readings of how consumers and producers perceive the performance of the economy and of how their respective finances or businesses are evolving. The Consumer Confidence Index for June recorded a 2.4% softening of sentiment compared to the same month ...

State Elections: Everyone Wins While Losing Something
MEXICO · Report · 09 Jul 2013

Executive Summary Last Sunday, 14 states went to the polls. They elected one new governor in Baja California, and renewed their municipal governments and local Congress. After a much disputed race, the PAN seems to have won the governorship of Baja California for the fifth time in a row. Although...

Week of July 9: Political Insights
BRAZIL POLITICS · Report · 09 Jul 2013

Two major economic events will take place this week: the announcement of budget cuts which, according to Finance Minister Guido Mantega, will be below R$ 15 billion; and the Central Bank’s decision regarding the basic interest rate. In Congress, the plebiscite on political reform remains on the a...

Sicad 2.0 on the Horizon
VENEZUELA · Report · 09 Jul 2013

The new Sicad system will begin operating in a matter of days. Key issues, such as theallocation mechanism, amounts to be auctioned, criteria defining qualified buyers, and of course, the exchange rate, are still undefined and in the hands of the Ministry of Finance and the central bank. Hopefull...

Caution over Investment Projections
BRAZIL ECONOMICS · Report · 08 Jul 2013

The only good news in the disappointing GDP results for the first quarter was the 4.6% increase in gross fixed capital formation. The question at this point is whether investments will continue on this recovery path, leading the investment rate to rise above 20% of GDP in 2013. The industrial pro...

Weekly Tracker: July 7-13
TURKEY · Report · 07 Jul 2013

Executive Summary The Egyptian coup could complicate things further for AKP, as party leaders openly side with Moslem Brotherhood.The counter-revolution is also making AKP more paranoid about Gezi Park. Large crowds descended on Taksim Square on Saturday, who met with startling police brutality. ...