Country Insights

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A Big Growth Surprise from Net Exports
HUNGARY - Report 13 Mar 2015
Executive Summary Detailed GDP figures for Q4 2014 show that the unexpected strength of output (+0.8% qoq sda) was mainly due to a pick-up in net exports. Consumer demand was also relatively strong, while fixed investment was losing momentum, and inventory accumulation remained markedly negative....

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Developments in Fiscal, Financial and Monetary Institutions
INDIA - Report 13 Mar 2015
Executive Summary There is an important three-pronged move in institution building, which comprises: (a) formal inflation targeting at RBI; (b) unburdening RBI of the conflict of interest of debt management for the government; and (c) giving RBI a bond market through which monetary policy would b...

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The Fiscal Deficit, Stupid
ARGENTINA - Report 13 Mar 2015
Executive Summary In this report, we update the concerns presented a year ago in our report “Dangerous Monetary Arithmetic”. We go into detail with regards the monetary implications of a rising fiscal deficit and the sustainability of the Central Bank’s sterilization cost. The Central Bank steril...

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Unemployment and Labor Income in the Recession
BRAZIL ECONOMICS - Report 13 Mar 2015
Executive Summary In this work we discuss the reflections of the expected contraction of GDP em 2015 on the unemployment rate and labor income. In the exercise, we assume that GDP will contract by at least 0.5% and at most 1.5%. The projections are based on data from the Monthly Employment ...

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​Power Situation Update
PHILIPPINES - In Brief 13 Mar 2015
In its latest update published today, the Department of Energy listed 240 companies that have signed up for the Interruptible Load Program (ILP) under which participants will voluntarily run their own generator sets instead of drawing power from the grid, should there be a power supply shortage. ...

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Ecuadorian Government: Whatever it takes
ECUADOR - In Brief 12 Mar 2015
Despite cuts of $1.4 b in expenditures, the 2015 budget still shows financing needs above $10 b. China came to the rescue with a comprehensive package of loans that amount to $7.5 b but only about $4b will be available in this year. This issue combined with falling yields for the Ecuadorian bonds...

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IMF gives us a chance: $5 billion in first installment and demand to keep moving with reforms
UKRAINE - In Brief 12 Mar 2015
Well, the IMF approved only $5 billion as first installment instead of $10 billion Ukrainian authorities demanded. Against the backdrop of aggravated internal fights between Poroshenko and Yatsenyuk (and growing rumors about the Cabinet reshuffle) this decision was quite logical. Advance payment ...

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First Impressions from the Erdogan-Babacan-Basci-Summit
TURKEY - In Brief 12 Mar 2015
I’m rushing my first impressions from the Erdogan, Babacan and Basci summit which concluded around 8 pm Turkish time last night. A brief statement from Erdogan followed around 9:30 pm. I wanted to pen this so that our Asian readers have something to work with. The summary is brief: Erdogan and hi...

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Politics: Anti-graft System’s First Steps
MEXICO - Report 11 Mar 2015
Executive Summary On February 26, the Chamber of Deputies approved by an overwhelming majority constitutional amendments proposed by the National Action Party for achieving a more effective anti-corruption system. If adopted in its present form, the reform would mark a major step in the right dir...

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Economics: Oil Steady, but not Public Finance
MEXICO - Report 11 Mar 2015
Executive Summary A core issue for defining Mexican public finance, especially as it affects the implementation of the 2015 federal spending budget and the design of the budget for 2016, as well as the country’s trade balance for both this year and next is the extent to which international oil ma...

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What to expect from the critical Erdogan-Babacan and Basci summit?
TURKEY - In Brief 10 Mar 2015
Davutoglu received a second briefing today from his economy team and announced that President Erdogan will receive economy czar Babacan CBRT head Basci on Wednesday (time of the meeting not available to me). The critical summit was preceded by a global EM F/X sell-off, massive turmoil in Turkish ...

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Week of March 9
BRAZIL POLITICS - Report 09 Mar 2015
The list of politicians involved in the Petrobras scandal will dominate the week and should increase the political temperature.The release of the names could influence the protests scheduled for the 15th.President Dilma meets with her political council on Monday.The House analyzes the minimum wag...

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Fighting for Peace
RUSSIA / FSU POLITICS - Report 09 Mar 2015
A long-awaited ceasefire benefits separatists in Novorossiya as they managed to use last days before it came into force to capture an important transportation hub and can now regroup and consider further advancement. Russia would prefer to avoid further sanctions and can now wait some time for a ...

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Forces Weakening the Real
BRAZIL ECONOMICS - Report 09 Mar 2015
Nobody who uses two elements – the Brazilian current account deficit and the change in the international scenario, marked by appreciation of the dollar and decline of commodity prices – could have doubts that Brazil has entered a currency depreciation cycle. But these two forces together are insu...

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Weekly Tracker: March 8-14
TURKEY - Report 08 Mar 2015
Executive Summary The main opposition party CHP is aiming high in this election. Can it really score the 35% it has set as a goal? We think not, but the fault doesn’t lay with the party. Meanwhile, former President Mr. Abdullah Gul is signaling that he may return to active politics. What kind of ...