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Country Insights

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Tulin’s interview hints to rate cut next week
RUSSIA ENERGY / FINANCE - In Brief 06 Mar 2015
Yesterday CBR’s new deputy governor for monetary policy Dmitry Tulin gave his first major interview to Interfax news agency. Mr Tulin tried to explain and defend CBR’s motives for last rate cut. While compared to Ms Yudaeva Mr Tulin communicates in a much more clear way we find his arguments not ...

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Fiscal Adjustment
BRAZIL POLITICS - Report 04 Mar 2015
Returned Provisional Measure a sign of congressional opposition to fiscal adjustment On Tuesday night, March 3, Senate President Renan Calheiros (PMDB-AL) decided to return Provisional Measure 669, which deals with payroll tax exemptions and other tax issues, to the Executive. In practice, this m...

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Beware of Headwinds Ahead
MEXICO - Report 04 Mar 2015
Executive Summary Economic activity firmed further through 2014, the latest data reveals, though some sectors suffered setbacks, and all analysts have lowered their growth forecasts for 2015. GDP rose 2.6% in Q4 2014, driven by growth in all three major sectors, and despite weakness in extractive...

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Core Encourages, Questions Remain
TURKEY - Report 03 Mar 2015
February CPI inflation came in at 0.7%, broadly in line with expectations, which raised the 12-month rate to 7.5%, up from 7.2% in January, because of – once again – a sharp increase in food prices. Producer price inflation continues to fare low, thanks to favorable base effects as well as the sh...

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Parliament approves budget amendments which should unlock the IMF loan
UKRAINE - In Brief 03 Mar 2015
On March 2 Ukrainian parliament approved changes to the spending plan 2015. Revenues’ target for state budget was set 37% higher than actual collections in 2014 (UAH 498.2 billion vs. UAH 363.6 billion). Central budget deficit was also increased to UAH 76.3 billion which is 4.1% of GDP. Combined ...

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The FDI Split
CHINA - Report 02 Mar 2015
Executive Summary Exports fell -3.3% y/y in January in dollar terms, down 11.8 pps from Q4. Export weakening was likely due to yuan appreciation against the dollar. Imports fell -19.9% y/y, down 18.3 pps. After correcting for the effects of the Chinese New Year holiday, import figures should a...

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Minister Takes Fall For Trade Drade
ECUADOR - Report 02 Mar 2015
Executive Summary Minister of Industries Francisco Rivadeneira was fired on February 19th, apparently over a dramatic tariff hike on Colombian and Peruvian imports, a move quickly rescinded in the Colombian case, and being reconsidered for Peru. Falling oil prices, combined with dollar appreciati...

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Declining Confidence Indicates Recession
BRAZIL ECONOMICS - Report 02 Mar 2015
The confidence indexes produced by FGV have a proven track record of pointing to economic trends. And all of them indicate a new round of deceleration. We start with the consumer confidence index (Graph 1), which has been falling since the second half of 2012, and more steeply since the middle...

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The Recession of 2015 and the Lessons of 1999 and 2003
BRAZIL ECONOMICS - Report 02 Mar 2015
Executive Summary The growth of the Brazilian economy started to decline in 2010, and disappeared totally in 2014, a year of stagnation. Diagnostic errors and unwitting experiments in conducting economic policy explain that performance. To reverse this situation – and preserve the country’s in...

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Week of March 2
BRAZIL POLITICS - Report 02 Mar 2015
Considerable expectations surround the list Prosecutor General Rodrigo Janot will release this week.With the release of the list, the Petrobras scandal will enter a new phase.The House could vote on minimum wage policy. The Senate is expected to focus on political reform.Congress meets to vote on...

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Budget Speech Analysis
INDIA - Report 02 Mar 2015
Executive Summary This Special Report was originally issued on March 1, 2015 as a post on GSP Direct, the GlobalSource Partners interactive webtool providing clients an initial response to breaking news and developments. The BJP, armed with a clear majority in the Lok Sabha and the desire to brea...

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Cabinet dismissal under discussion
UKRAINE - In Brief 02 Mar 2015
After new wave of hryvnia decline the Cabinet of Yetsenyuk is under attack. Budget deficit and hryvnia printing for budget needs were named as the key reasons for hryvnia plunging below 30 hryvnia per $1. On Feb 28 I was invited for a meeting with prime-minister and minister of economy. Near 10 e...

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Budget Speech Analysis
INDIA - In Brief 01 Mar 2015
The BJP, armed with a clear majority in the Lok Sabha, with the desire to break with Indian socialism, was expected to unveil a game plan for structural change from here till 2019. In large part, Budget 2015 does not rise to the challenge. It has some good elements, and with good execution, they ...

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Honeymoon Cut Short
TURKEY - Report 01 Mar 2015
Executive Summary Hours before our editing deadline, incarcerated PKK leader Mr. Abdullah Ocalan issued a call to separatist terror organization PKK to convene its Grand Convention to consider a “reinforced ceasefire”. Can it work? We only assign 30% odds to success. What does President Erdogan w...

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Government Crackdown
VENEZUELA - Report 28 Feb 2015
Executive Summary Although the launch of the new Marginal Currency System (Simadi) dominated economic headlines in February, it proved to be much ado about nothing. Despite the economic crisis and approval ratings at a paltry 20 percent, Maduro and his allies have consolidated themselves as chavi...