GlobalSource Partners | Country Insights

Putin has always taken debt very seriously indeed. In 1998 Russia was a few billion dollars short of meeting its repayments and the financial system was wrecked as a result. It appears that Putin must have vowed that he would never let this recur. Therefore he pursued a policy of iron fiscal disc...

Georgia appoints a new Prime Minister

RUSSIA / FSU POLITICS · In Brief · 11 Sep 2019

A new prime minister has taken office in the Republic of Georgia. Georgi Gakharia, a member of the ruling Georgian Dream Party, became prime minister on September 8. Gakharia, 44, previously served as interior. He has been denounced as a Moscow stooge by the opposition. He studied at Lomonosov Un...

The forint went to a new record low again

HUNGARY · In Brief · 11 Sep 2019

This morning, the forint weakened to EURHUF 332.15, a new record low. Apparently, yesterday's inflation data, which signalled the very likely continuation of loose central bank policy, and the rather unexpectedly revealed conflict between governor Matolcsy and finance minister Varga, had an impac...

Castillo will face former President Fernandez in the PLD primaries

DOMINICAN REPUBLIC · In Brief · 10 Sep 2019

Gonzalo Castillo has been selected, on behalf of the Danilo Medina faction, to run against former president Leonel Fernández in the PLD primaries on October 6. Castillo, who was Medina's public works minister for over seven years, has a limited political history, but has been very loyal to Medina...

Two appointments that come as wonderful news

COLOMBIA · In Brief · 10 Sep 2019

Juan Pablo Zárate steps down from the board of the Central Bank and returns to his old post as Deputy Finance Minister. Undoubtedly one of the most influential members of the board during his 10-year tenure, Mr. Zárate becomes Minister Carrasquilla’s wingman in the midst of a closely-monitored an...

August CPI-inflation somewhat mixed, but more good news than bad

HUNGARY · In Brief · 10 Sep 2019

The headline rate fell to 3.1% yoy from July's 3.3% yoy, mainly, though not exclusively, on lower food prices, on account of which consumer prices fell by a marginal 0.1% mom. The latter was partly seasonal, given the typically beneficial impact of the summer season on food prices, but not entire...

Bank of Russia cuts key policy rate

RUSSIA / FSU POLITICS · In Brief · 10 Sep 2019

On September 6 the Bank of Russia lowered its key policy rate by 25 basis points. It is now 7%. This was widely anticipated. The move was actuated by a persistent slowing of inflation as well as poor economic growth. Inflation is now down to 4.3% YoY in August. The Bank of Russia (CBR) has a targ...

The Parallel Pension Plan PEC may stay on paper and other weekly topics

BRAZIL POLITICS · Report · 09 Sep 2019

The president of the Senate, Davi Alcolumbre (DEM-AP), is working on building a consensus for the first round vote on Pension Reform on the Senate floor. State finance secretaries are presenting suggestions to Congress on Tax Reform. President Jair Bolsonaro has until Thursday, September 12, to s...

A shot of realism

BRAZIL ECONOMICS · Forecast · 09 Sep 2019

Until recently, many observers believed that with the approval of the pension reform, the real would appreciate and GDP growth would accelerate. However, there has been a wave of downward revisions of the growth projections for 2020 (for 2019 the consensus remains around 0.8%), and instead of str...

Mexico's government wants to have its cake in 2020 (fiscal discipline) and eat it too

MEXICO · In Brief · 09 Sep 2019

Mexico’s government just published its macroeconomic outlook and fiscal plan for 2020. In our view it presents a very optimistic prospect on both accounts. Most likely next year’s economic growth will be below 2%, the fiscal deficit higher than the government foresees (2.7%-3.0% of GDP) and the p...

Economics: The stabilization funds in a context of shrinking revenues

MEXICO · Report · 09 Sep 2019

The extent to which economic growth is expected to deteriorate further in 2019-2020, combined with the precariousness of public revenues and spending, suggest that the Ministry of Finance may use the federal spending budget for 2020 to change the rules that determine the way specific funds are to...

Politics: Neither surprises nor innovations - notes on the State of the Union address

MEXICO · Report · 09 Sep 2019

This report gives our views on the State of the Union address presented by President Andrés Manuel López Obrador. We will be reporting on the recently released budget plan in an upcoming In Brief. Despite his best efforts to claim he was delivering his third report on the state of the nation s...

Ruling party in Russia performs badly in regional elections

RUSSIA / FSU POLITICS · In Brief · 09 Sep 2019

On September 8 elections to regional councils were held in many parts of Russia. The ruling party (United Russia) performed badly as anticipated. United Russia lost a third of its seats on Moscow City Council and now only just holds a majority. This is a a symptom of growing public discontent wit...

Current account and portfolio investment trends: an Alert

BRAZIL ECONOMICS · Report · 09 Sep 2019

In this strange cycle through which the Brazilian economy is going through, manufacturing is one of the segments that is suffering the most (the other being civil construction). Although its performance was one of the positive highlights in the GDP figures for the second quarter, when manufacturi...

Moderating wage pressure supports moderate inflation

ISRAEL · Report · 09 Sep 2019

Wage growth appears to have moderated in Q219, supportive of weak inflationary pressure. The fiscal deficit stabilized at 3.8% of GDP in August, and is likely to remain at this level into end-19. Various indicators are pointing to steady growth in Q319, such as strong business and consumer confid...