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On the road to normality? Growth nears potential and inflation is under control, but currency depreciation and interest rates are high
DOMINICAN REPUBLIC · Forecast · 16 Apr 2024

Q1 2024 ends with some signs that the Dominican economy is on its way to achieving trend values for key economic variables, such as growth and inflation. In January-February the average interannual growth of economic activity was 5.4%, close to potential growth, and inflation in Q1 was 3.33% y/y,...

Floods threaten Russian cities
RUSSIA / FSU POLITICS · In Brief · 16 Apr 2024

Flooding has gotten worse in Russia and Kazakhstan in mid April. An unusually early and warm spring caused snow and ice to melt abruptly. The premature and sudden thaw means that rivers have burst their banks. Heavy rains have aggravated the situation. The Ishim River, which flows from Kazakhstan...

The government submitted the Budget guidelines bill, the regulation of Tax Reform has been postponed to April 22, and Pacheco said the complementary law on state debt will be submitted this month
BRAZIL POLITICS · Report · 16 Apr 2024

The government sent the Budget guidelines bill to the National Congress yesterday, which includes the parameters of the 2025 Federal Budget. The fiscal target for next year was reduced from 0.5% to 0% of GDP. Yesterday, the Minister of Finance, Fernando Haddad, confirmed that the regulation of Ta...

Boluarte government weakened further; economic recovery takes off in Q1 2024; BCRP’s 25bp cut surprises markets
PERU · Report · 16 Apr 2024

In this report we discuss recent political developments, with a focus on President Dina Boluarte; using high-frequency economic reports, we present our updated forecast, and argue that the economy rebounded in Q1 2024; and discuss the BCRP Board’s decision to cut rates by 25bp, surprising both ma...

Economics: US industry’s stalling trend and the super peso continue to undercut Mexico's manufacturing
MEXICO · Report · 16 Apr 2024

Last week’s industrial activity report for February confirmed a continuation of its slowing trend. The construction sector remained almost the only source of growth but its pace slowed to a rate well below the average of the previous nine months. US industrial production’s stalling trend dati...

Difficulties in the legislature and other weekly topics
BRAZIL POLITICS · Report · 15 Apr 2024

The government submits the Budget Guidelines Bill and proposals for regulating Tax Reform to Congress. Negotiations continue around payroll tax relief for companies and municipalities, in addition to Perse (the events sector program). Rodrigo Pacheco meets with governors to discuss state debt. ...

Uzbekistan represses Islamists
RUSSIA / FSU POLITICS · In Brief · 15 Apr 2024

In April 2024 the Uzbek government responded to the March 2024 Crocus City Hall attacks in Moscow by ramping up police action against those suspected of religious extremism and terrorism. The police have searched the residences of suspects. The public have been told not to put their children into...

Inflation in the United States and Interest Rates in Brazil
BRAZIL ECONOMICS · Report · 15 Apr 2024

Inflation in the United States has been more persistent than expected according to CPI data disclosed last week, which indicated a continued acceleration trend, especially in core measures. The worsening of the underlying measures of US inflation has occurred against a backdrop of heated economic...

Tax collections and weak demand held March inflation steady
VENEZUELA · Report · 15 Apr 2024

Inflation held steady at 1.2 percent in March. While, starting in the third week of March, bolivar depreciation against the dollar and a transportation fare hike pushed up on inflation, and monetary expansion caused by domestic public outlays expanded by 21 percent compared with 9 percent in Febr...

Inflation in March slightly above expectations, but core remains low
ISRAEL · In Brief · 15 Apr 2024

Inflation in March slightly above expectations Inflation in March (0.6% m/m 2.7% y/y, following 2.5% last month) was slightly above expectations of 0.5% on average. Core inflation inched up to 2.3% y/y from 2.2% last month but this is due to higher taxation on cigarettes contributing 0.1% to the ...

Pacheco meets with governors to discuss state debt, the government is considering changing the fiscal target for 2025, and the House will continue to analyze important bills this week
BRAZIL POLITICS · Report · 15 Apr 2024

Senate President Rodrigo Pacheco and the governors who are requesting the restructuring of their debts with the federal government will discuss the general lines of a complementary bill to regularize state debt. The fiscal target for this year is 0% of GDP. For 2025, the government had defined a ...

What could happen if GL 44 expires on April 18?
VENEZUELA · Report · 15 Apr 2024

The possible expiration of General License 44 (GL 44) generates uncertainty. Venezuela's oil production and exports have been increasing since 2022 under licenses 41 and 44 . Both allow selling oil in Venezuela's natural markets (the US and Europe) at better prices, with more efficient collectio...

Politics: In a context of lackluster campaigns, the first presidential debate probably only had a marginal impact
MEXICO · Report · 15 Apr 2024

With Xóchitl Gálvez trailing by 17 points and only 8% of registered voters still undecided according to the latest El Financiero poll, and less than six weeks left to the campaign, time is running out for the main opposition presidential candidate to begin making significant inroads with undecide...

Markets shrug off escalation
ISRAEL · Report · 15 Apr 2024

1. So far, markets appeared unfazed by the recent Iranian strike on Israel, including the equity, bond and FX markets. 2. The BoI kept rates unchanged at its most recent meeting due to current elevated geopolitical risks, but expects easing in the coming year. 3. The economy has recovered...

New opposition star announced his party, runs at European election in June
HUNGARY · In Brief · 15 Apr 2024

Péter Magyar, who appeared as an opposition politician just a few weeks ago, and has been ambitiously working to build himself up as a leading figure ever since then, has announced his new party (TISZA Respect and Freedom), and also the fact that this party has been registered by the National Ele...