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Country Insights

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Global bonds allocation in sight
DOMINICAN REPUBLIC - In Brief 16 May 2019
As we noted in our last monthly report, the Ministry of Finance is preparing to issue and allocate global bonds in the international market. The information was provided yesterday by Minister Donald Guerrero, who also indicated that the unusual delay in the placement of the 2019 bonds has been du...

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2019 Outlook: Suppose Maduro survives
VENEZUELA - Forecast 16 May 2019
With the Maduro regime so shaky, to anchor and focus our forecast, we assume regime survival through 2019 and project this year alone. In our next forecast report, we’ll present 2020-2021 forecasts under alternative regime scenarios. The Maduro regime wants to revive private industry and attac...

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Deposit reserve requirement ratio cut
PHILIPPINES - In Brief 16 May 2019
The BSP announced today a staggered reduction in the reserve requirement ratio (RRR) on bank deposits as follows: 1ppt effective on May 31, 0.5ppt on June 28, and 0.5 effective July 26. These will bring the RRR for commercial banks, currently at 18%, to 16% by the end of July. A 1ppt cut is estim...

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What slowdown? The economy is overheating
HUNGARY - Report 15 May 2019
GDP growth accelerated to a new high in Q1 2019, in the face of the weak Eurozone economy. This looks like a regional phenomenon typical of Central and Eastern Europe: Poland, Romania and Hungary all reported GDP growth around 5% in the first quarter of this year. A relocation of output from West...

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Gates of the unknown open wide
UKRAINE - Report 15 May 2019
Three weeks have passed since the name of the sixth president of Ukraine was confirmed. But neither key appointments nor the first steps of the new administration have been announced. President-elect Volodymyr Zelenskiy’s advisors are busily making comments, but none of these speakers have offici...

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Inflation heads back to 50% m-o-m and more
VENEZUELA - Report 15 May 2019
We revised down our April inflation estimate to 35 percent from 45 percent in our previous report. The price of the dollar in the parallel market rose by 21 percent, lower than our expected 42 percent, and consumption was weaker than expected for longer than expected. Accumulated inflation for Ja...

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Election results (2)
PHILIPPINES - In Brief 15 May 2019
A reader asked us what are the implications of Monday’s election results which we outlined yesterday. Offhand, we say that they clearly give President Duterte greater control of the legislative agenda moving forward. The hope is that he will use his political capital to more forcefully back up Fi...

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ANC announces premier candidates for provinces it will govern
SOUTH AFRICA - Report 14 May 2019
Following its elections win last week, the African National Congress (ANC) party convened a special national executive committee meeting on Monday, May 13, 2019, at which it presented seven of its eight premier candidates for provinces in which it received the majority vote. The premier for one o...

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Weak business cycle conditions in the Indian economy
INDIA - In Brief 14 May 2019
For a few years, there has been a tension between two views of the Indian economy. One view was grounded in the GDP data, and saw high GDP growth rates. Another view was grounded in the firm data, and saw weak performance of firms. Our work on building a `coincident indicator' is a valuable path ...

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Russian IT company showing successful IPO on NASDAQ
RUSSIA / FSU POLITICS - In Brief 14 May 2019
Russian IT company Headhunter completed an IPO at NASDAQ last week, showing successful early trading. No Russian company has achieved this since 2013. Headhunter has been assisted by a few US investment banks. Goldman Sachs, Morgan Stanley, Credit Suisse, Bank of America and Merrill Lynch are som...

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Expect robust Q1 GDP data tomorrow
HUNGARY - In Brief 14 May 2019
Analysts expect 5.1% yoy GDP growth by unadjusted data for Q1 to come out from the KSH tomorrow at 9am BUD time. This would be unchanged from Q4 2018 and contrary to everyone's forecast that growth would slow down markedly in Hungary, following the European trend, this year. Even though there hav...

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Election results
PHILIPPINES - In Brief 14 May 2019 1 response
We had expected candidates allied with President Duterte to take most of the contested Senate seats in yesterday’s mid-term elections but it looks like they are slated to take all 12 seats. And while we did not think that the elections should be taken as a referendum on the President and his poli...

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Incoming storm for Pension Reform and other weekly topics
BRAZIL POLITICS - Report 13 May 2019
The government may send Congress a plan for the states. In the Lower House, several important provisional measures are on the agenda, such as the measure that reorganizes the structure of the government, and the regulatory framework for sanitation. President Jair Bolsonaro travels to the US. Stud...

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High NFPS deficit in the first quarter of 2019: the challenges to Cortizo´s administration
PANAMA - In Brief 13 May 2019
The net deficit of Q1 was $966 million: 1.4% of projected (by MEF) nominal GDP for the complete year, or around 5% of “adjusted” GDP for the quarter. This figure does not include payments in arrears to contractors (a figure that may be at least 600 million, according to private sources). The prim...

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Russian open-ended investments
RUSSIA / FSU POLITICS - In Brief 13 May 2019
In April this year Russia saw a marginal (USD 1.1 million) increase in open-ended investment funds. Interest rates have been dropping, meaning depositing in a bank does not make much sense. The interest rate is currently 7.75% down from 8.25% in 2017. The Russian stock market has rebounded since ...