Country Insights

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Buying Time
VENEZUELA - Report 26 Mar 2014
Executive Summary Two months of protests have left dozens dead, hundreds injured, over 1,800 arrested, assets damaged, and daily life disrupted. Government repression has been severe. Constitutional violations have set dangerous precedents. This turmoil has hurt the government’s image abroad but ...

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Slowing of Growth in Bank Credit
MEXICO - Report 25 Mar 2014
Executive Summary Bank lending to the private sector slowed during the second half of 2013 and early 2014 at least partially in response to a less dynamic internal market and consumer pessimism regarding the economy. As of January 2014, consumer credit was growing at its slowest pace since 2010. ...

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Recovery by Yearend?
INDIA - Report 25 Mar 2014
Executive Summary Our report of December 2, 2013 projected export buoyancy and a fall in companies’ interest rate payments, and said this would lead to better performance for large firms in 2013. Q4 data bears out all three predictions -- though the improvements were less robust than we expected....

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New Hurdles for Reforms
MEXICO - Report 25 Mar 2014
Executive Summary The road to structural reforms just keeps getting longer and bumpier. The administration of President Enrique Peña Nieto had promised to hand lawmakers its bills for the secondary laws on telecommunications and energy reform by early February, but with just over a month left in ...

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CORRECTED - Sicad II started at last. No surprises.
VENEZUELA - In Brief 24 Mar 2014
In line with Rafael Ramírez’s unofficial announcements, the average price of the dollar in Sicad II in its first day of operations was 51.86 Bs/$, as BCV reported at 6:00 PM. No information was given on trading volume. However, we believe volume today was low. Participants and banks have had litt...

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Inflation: Uptick Prevents Ending the Tightening Cycle
BRAZIL ECONOMICS - Report 24 Mar 2014
Until recently the signals from the Central Bank were that since inflation was decelerating, the end of the monetary tightening cycle was nearing. But the period of decelerating inflation was short lived. The resistance of some free prices, especially of services, combined with the sharp rise of ...

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Slowdown Against Government Target
CHINA - Report 24 Mar 2014
Executive Summary People’s Bank of China Governor Xiaochuan Zhou announced in a March 11th press conference that deposit interest rates would likely be “liberalized” in one or two years. Four days later, the Bank announced on its website that the daily trading band for the RMB would broaden to...

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Democracy or Monarchy?
ECUADOR - Report 24 Mar 2014
Executive SummaryThe president’s Alianza Pais suffered a major political setback in the February 23rd local elections, losing control of nearly all key municipalities. Rafael Correa recognized the sectarianism of some party members, and expressed disappointment over his party’s apparent lack of p...

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Growth Got Better And Inflation Decelerated
INDIA - Report 24 Mar 2014
Executive Summary The report of 2 December 2013 had suggested that in Q4 2013 there would be export buoyancy, reduced interest payments by firms, and hence improved performance of large firms. All three predictions have been borne out by the Q4 data. There is some easing of tradeables inflation, ...

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Political Insights: Week of March 24
BRAZIL POLITICS - Report 24 Mar 2014
On Tuesday, the opposition discusses the creation of a Parliamentary Investigative Committee to investigate the Petrobras purchase of a refinery in Texas. The House may vote on the Internet Framework Law.A Joint Congressional Committee may vote on the provisional measure that deals with taxation ...

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Weekly Tracker: March 23-29
TURKEY - Report 23 Mar 2014
Executive Summary Turkey’s Twitter ban may be followed up by new restrictions on access to YouTube or even Google. The question is why Erdogan would risk so much for very little political gain. Is Internet costing him the elections? We expect great drama and hopefully no major tragedy in the fina...

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Brazil Presidential Election
BRAZIL POLITICS - Report 21 Mar 2014
Desire for change challenges Dilma’s lead On Thursday evening, March 20, Ibope released a presidential voting intention poll. The poll, conducted on March 13-17, presented practically the same results as the previous poll from November. However, even though President Dilma has a comfortable lead ...

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Sweet bird of mine
TURKEY - In Brief 21 Mar 2014
Sometimes one sentence- more than many scholarly articles- sums up the political situation in a country. As of today, for Turkey, that sentence has become “Twitter is banned”. Less than 24 hours after Erdogan promised in a vocal rage the ban “the twitter and like”, courts obliged, granting Turkey...

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Suddenly Hawkish
PHILIPPINES - In Brief 20 Mar 2014
The BSP took its cue from the US Fed and signalled today a prospective rate hike when the Monetary Board meets next week. The Fed earlier indicated that it may move forward the timetable for ending its stimulus program, with markets projecting a rate hike as early as April 2015 (from July previou...

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2014 Outlook Grows Cloudy
MEXICO - Report 20 Mar 2014
Executive Summary Now that the first phase of the structural reform process is complete, attention has shifted back toward more immediate concerns, especially the extent to which the economy is likely to grow in 2014. In previous issues of Weekly Trends: Mexico Economy we have argued that GDP gro...