GlobalSource Partners | Country Insights

On January 19 the US sanctioned the ship Fortuna. Fortuna is owned by KVT RUS. Germany has expressed its disappointment. Nord Stream 2 will carry LNG from Russia to Germany. This is crucial for German energy policy. The USD 11 billion pipeline is 95% complete.There are asset freezes and visa rest...

The current account widens in 4Q20 as exports grow

RUSSIA ECONOMICS · In Brief · 19 Jan 2021

The Central bank released its first estimate of the 2020 balance of payments. The current account was in surplus at $32.5bn, and the figure is close to what GKEM Analytica expected (around $35bn or 2.4% of GDP). Meanwhile, in 2019 the current account surplus was twice as wide – $64.8 bn.The trade...

Economics: 2021 Economic prospects and hurdles

MEXICO · Report · 18 Jan 2021

It will take a lot more than a successful Covid-19 vaccination drive to get the Mexican economy back on a firm recovery path, and an effective inoculation campaign is by no means certain at this point. Obviously the 2021 outlook will be determined by many moving parts, ranging from the strength o...

Politics: 4T Agenda, past, present and Future

MEXICO · Report · 18 Jan 2021

President López Obrador made a public commitment last September to pass by the end of 2020 all of the essential constitutional reforms and legislative bills comprising the basic structure of what he has long promised will be the fourth historical transformation of Mexico. But although he has tak...

The government against the ropes and other weekly topics

BRAZIL POLITICS · Report · 18 Jan 2021

Expectations surround the beginning of vaccinations against Covid-19 this week. In the economy, we highlight the Central Bank meeting to set the benchmark interest rate. On Wednesday, Joe Biden will be inaugurated as President of the United States. This week's Talking Points * The governme...

Russia arrests Navalny on his return

CIS POLITICS · In Brief · 18 Jan 2021

On January 17 Alexei Navalny flew back to Russia after months recovering in Germany. As the government warned him he would be, he was arrested within minutes of landing. The reason for his arrest was for parole violations. He has been in and out of jail several times already. Hundreds of well-wis...

The hyperinflation menace remains near

VENEZUELA · Report · 15 Jan 2021

Our central inflation forecast scenario has inflation slowing down a bit in 2021, to 2,200 percent this year from 2,500 percent last year. Black market dollars appreciate against the bolivar by 1,700 percent and sell for 20 million bolivars by year end but lose bolivar purchasing power for the fo...

Retail sales and China’s “Super Cities”

CHINA ADVISORY · Report · 15 Jan 2021

Retail sales have declined due to Covid. However, we expect a strong pick-up in sales as the impact of Covid weakens because of several factors. First, the growth in household bank deposits has remained strong; and second, the majority of national retail sales occur in a small subset of the count...

Deflation of 0.7% in 2020

ISRAEL · In Brief · 15 Jan 2021

December’s CPI surprised on the downside, declining 0.1% m/m (-0.7% y/y compared to -0.6% in November). Core inflation (the CPI excluding energy items and fresh produce) reached -0.4% y/y in December, following -0.2% in November. The main inflation surprise came from the housing rental item (17.2...

The BoI commits to purchasing 30bn USD this year

ISRAEL · In Brief · 14 Jan 2021

The Bank of Israel announced today that it will purchases 30bn USD in order to stem the forces supporting shekel appreciation. The shekel has appreciated rapidly since November, a trend which accelerated into January. 30bn USD is a significant amount (21bn were purchased in 2020) and could defini...

The authorities return natural gas price regulation amid public protests

UKRAINE · In Brief · 14 Jan 2021

The Cabinet returned price regulation for natural gas on January 13th. The decision was delivered on the heels of mass protests against tariffs’ increase. From January 2021 many gas distributing companies have increased natural gas prices for customers, substantially on the back of growing prices...

The Worsening Pandemic and Uncertainty over the Economy

BRAZIL ECONOMICS · Report · 13 Jan 2021

We start by urging those who typically attribute “subjective probabilities” to the occurrence of events to read the book Radical Uncertainty, written by Mervin King (former governor of the Bank of England) and John Kay. They recommend that when faced with a situation of radical uncertainty – as i...

International Reserves Replacement and Expansion Program

CHILE · In Brief · 13 Jan 2021

In an unexpected decision, the Central Bank of Chile announced today the purchase of US$ 12 billion in the spot market with the goal of increasing international reserves to 18% of GDP (the highest figure since 2003). The Central Bank plans to buy US$ 40 million per day over a period of 15 months....

Minfin is back as an FX buyer

RUSSIA ECONOMICS · In Brief · 13 Jan 2021 · 1 response

Today, the Finance Ministry announced that it resumes purchasing of the hard currency on the open market according to the “fiscal rule”. From Jan 15 till Feb 4 it will spend R7.1 bln daily for this purpose. To remind, the rule was working in the opposite direction for the last 8 months, since Apr...

Russia's gold reserves worth more than its USD holdings

CIS POLITICS · In Brief · 12 Jan 2021

On January 11 the Russian Central Bank (CBR) published statistics showing how its gold reserves have appreciated in value. The report details the situation 6 months ago.In June 2020 Russia had USD 128.5 billion in gold. That was 23% of the country's international reserves. These gold reserves wer...