Country Insights

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Politics: AMLO squares off against CSOs
MEXICO - Report 11 Mar 2019
President López Obrador’s decision to promote a 2019 budget that halved the funds earmarked for the government’s Childcare Facility Program, which benefits well over 300,000 children from low income households, sparked considerable concern. But the apprehension grew when he decided this year to a...

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In recession, of a balance sheet kind
TURKEY - Report 11 Mar 2019
The Turkish GDP contracted by 2.4%, q/q, in Q4, after a 1.6% contraction in Q3 (revised down from 1.1% previously), broadly in line with expectations, which also means that by the widely-accepted popular and technical definition of recession (of two consecutive quarters of sequential decline), th...

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Business cycle conditions
INDIA - Report 11 Mar 2019
The conventional GDP data shows a recovery in late 2017. However, the Indian GDP data became less reliable with the methodology change in 2015, which applies to the series from 2012 onwards. We assess business cycle conditions through three pathways. We have constructed a “coincident indicator...

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Steady CA surplus (2.9% of GDP in 2018) and strong FDI are shekel positive
ISRAEL - Report 11 Mar 2019
The CA surplus reached 11bn USD (2.9% of GDP) in 2018 and net FDI an additional 4.2%: macro fundamentals remain shekel positive. Israeli saving institutions reversed their demand for FX demand and sold 1.7bn USD in January 2019. The fiscal deficit surprised on the upside in February, reaching 3.5...

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Venezuela – the Russia connection
RUSSIA / FSU POLITICS - Report 10 Mar 2019
After the dismantling of the Soviet Union, Moscow largely neglected Latin America. Two events were key to changing the situation, namely, the international response to Russia’s occupation of Abkhazia and South Ossetia in 2008; and to the Russian annexation of Crimea and support for Donbass rebels...

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Disinflation and depression
VENEZUELA - Report 10 Mar 2019
At the time this report was ready for distribution on Thursday, March 7, a blackout paralyzed Venezuela and is still ongoing. We don’t know yet the extent of the damage, when the supply of electricity will stabilize, and what the new normal will be. It’s too early to assess the damage. The bla...

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Election campaign runs into S-400s
TURKEY - Report 10 Mar 2019
Turkey and the US stepped towards the ring once again, with Pentagon issuing a final warning to Ankara that the purchase of S-400s is a sanctionable act. Ankara doesn’t take the threat seriously, hoping that Trump will intervene at the last second. Turkey’s relations with the West has taken a tur...

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Russia seeks private investment in the Arctic
RUSSIA / FSU POLITICS - In Brief 09 Mar 2019
Russia's special representative on Far East Development (Yuri Trutnev) announced that he is in favor of finding new investment regimes to open access to the Artic shelf's oil and gas fields. The Arctic shelf was once estimated to have up to 67% of the oil and gas in Russia's Arctic. At the moment...

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February inflation data sends a clear message to the MNB
HUNGARY - In Brief 09 Mar 2019
The recent uptrend of consumer inflation continued by all existing measures, and it even accelerated, in February. The direction was widely expected but the pace was not. Headline CPI-inflation was 0.6% mom, which pushed the yoy rate back up to 3.1%, following the 2.7% figures recorded in both of...

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Prime Minister Cesar Villanueva Resigns
PERU - In Brief 08 Mar 2019
President Martin Vizcarra accepted the resignation of the president of the council of ministers (also referred to as Premier or Prime Minister) Cesar Villanueva this afternoon. It is rumored that his resignation was prompted by Minister of Finance Carlos Oliva's disagreement on the way that a tru...

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Maduro hangs on, but time isn’t on his side
VENEZUELA - Report 08 Mar 2019
The opposition lost some momentum after a month on the offensive when, on February 23, the Maduro regime used irregular armed groups and formal security forces to block aid shipments from coming in through Colombia and Brazil. With this move, the regime showed that it has no scruples in deploying...

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South Africa’s fourth quarter current account balance improved, but deteriorated for 2018 as a whole
SOUTH AFRICA - Report 07 Mar 2019
Data released by the South African Reserve Bank shows that there was a significant narrowing of the country’s current account deficit during the fourth quarter of 2018 from the third quarter as it contracted by R70.2 billion, from R180.4 billion to R110.2 billion. The current account deficit as a...

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A cry for re-election?
DOMINICAN REPUBLIC - Forecast 07 Mar 2019
Growth continues to be remarkable, with real GDP rising 7% in 2018. Inflation, at 1.17%, fell significantly below the lower limit of the target range, and financial institutions’ performance was robust. Although the CAD increased to the equivalent of 1.4% of GDP, reserves remained strong, and FX ...

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No surprises from the MPC
TURKEY - In Brief 06 Mar 2019
As expected, the CBRT’s Monetary Policy Committee (MPC) kept the policy rate (one-week repo rate) at 24% (simple) today, which was the last meeting before local elections of March 31st. Recall also that this is the fourth consecutive meeting that the Bank left rates unchanged, since it had raised...

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The EPP is starting an exclusion procedure against Fidesz
HUNGARY - In Brief 06 Mar 2019
The European People's Party's management has just announced that it is starting an exclusion procedure against Fidesz immediately, after 13 member parties from nine different countries initiated to exclude PM Orbán's party from the organisation. The EPP's rulebook says that such a procedure must ...