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Country Insights

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All civilians evacuated from Azovstal, Mariupol
RUSSIA / FSU POLITICS - In Brief 08 May 2022
On May 8 Ukraine announced that the evacuation from the steel factory had been completed. The Ukrainian soldiers are still in the factory. Russia is eager to capture Mariupol because then it will complete the land corridor from Russia to Crimea.Russia confirmed that the evacuation had been carrie...

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The shekel weakens on market volatility
ISRAEL - In Brief 08 May 2022
We have revised our inflation forecast upwards to 3.3% NTM In the past, we factored in a modest shekel appreciation on the back of the strong CA surplus and net FDI. Currently, we think that equity market volatility is a more dominant factor impacting the shekel and therefore we are pricing sheke...

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Livin' La Vida Loca
TURKEY - Forecast 08 May 2022
We stick to the macro scenarios we’ve introduced in earlier reports but tweak the odds a little – for the worse, on the back of the adverse shock inflicted by the Russian invasion of Ukraine. To recall, we surmised that three macroeconomic scenarios could play out between now and the elections, b...

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Kyrgyzstan and Tajikistan face economic disaster
RUSSIA / FSU POLITICS - In Brief 08 May 2022 1 response
The per capita income of the country is expected to be USD 1,300 per annum. That is the second lowest in the former USSR after Tajikistan. It is lower than war-torn Ukraine.Tajikistan is a mountainous land of 6 million people. It is largely bereft of natural resources. Sanctions on Russia indirec...

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Ukrainian forces started counter-offensive amid inflowing modern weapons
UKRAINE - In Brief 07 May 2022
Two days till the May 9th, Victory Day – a sacred day for USSR-longing inhabitants of Russia. Now we can say it for sure, ‘the big battle for Donbas’ turned out to be one more failure for Russian army. Despite substantial concentration of forces and armors at the East, the Russians managed to get...

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EU desperate for Azerbaijan's gas
RUSSIA / FSU POLITICS - In Brief 06 May 2022
The EU is trying to wean itself off Russian oil by the end of 2022. The EU would like to reduce Russian gas imports but cannot see a way to stop them totally. 40% of EU gas comes from Russia. If Azerbaijan sells more gas to the EU, then the EU can decrease purchases of Russian gas very substantia...

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Russia’s pandemic/political update: So they say in the news
RUSSIA ECONOMICS - Report 06 May 2022
For yet another month the pandemic has not been a big issue either in the media or in the minds of ordinary Russians, as both the daily incidence rate and the death toll continued to fall (the former fell to around 5K in recent days from a peak of around 200K in mid-February). It was another irre...

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A surprise rate hike
INDIA - Report 06 May 2022
On May 4, the RBI came out with a surprise 40-bp rate hike. There are three puzzles here: Why a surprise action, why 40 bps, and why May 4? What is the monetary policy strategy that plausibly generated this? It is possible to reconstruct the logic for this from the viewpoint of exchange rate obj...

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GULF WEEKLY: Oil up as OPEC+ tapers steadily, rate rises mirror Fed, CIA director visits Saudi
GULF COUNTRIES - Report 06 May 2022
​A skimmable summary overlaid with our analysis and links. Headlines: * Oil rises on Russian oil ban fears, a limited OPEC+ taper and stasis in Iran nuclear talks. * The NOPEC bill to enable antitrust action against OPEC passed a US Senate committee 17-4. * Most Gulf states mirrored the Fed’s ...

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Fiscal expansion is counteracting lockdowns
CHINA - Report 06 May 2022
Lockdowns in Shanghai and other cities since March have interfered with robust economic recovery. GDP rose 4.8% y/y in Q1, up 0.8 pps from Q4 2021, but 0.2 pps lower than in Q1 2021. Industrial output rose 6.5% in Q1, up 2.6 pps from Q4, but down 1 pps from January-February. Investment rose 9.3% ...

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Tension between the branches of government remains high, João Doria still faces resistance in the PSDB, and Lula’s pre-candidacy for the Planalto Palace will be officially launched tomorrow
BRAZIL POLITICS - Report 06 May 2022
Regarding the institutional tension, STF President Fux has stated that he and Senate President Pacheco are “aligned on the objective of defending the government’s institutions and our Constitution”. Despite efforts at dialogue and attempts to de-escalate the institutional conflict, the likelihood...

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Russian gas in RUB for the EU: current status
RUSSIA ENERGY / FINANCE - In Brief 06 May 2022
Russian gas exports to EU From April 27 Gazprom stopped publishing its own operational statistics on natural gas supplies to the EU countries. Probably it's due to the desire not to show further reduction in exports, including its termination to supply gas to Poland and Bulgaria. According to thi...

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Russian financial markets: a new approach to pricing
RUSSIA ECONOMICS - Report 06 May 2022
The Russian economy will face a deep economic contraction in 2022 amid the harsh sanctions regime, and its financial markets have to adjust rapidly, trying to find an acceptable way to exist in the new reality. This process is further complicated by the rapid changes in external factors (mostly n...

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Russian Army recruitment offices suffer arson attacks
RUSSIA / FSU POLITICS - In Brief 06 May 2022
On May 5 a recruitment office was burnt down by Molotov cocktails. The police are seeking two male suspects. Five other military recruitment offices have been burnt by Molotov cocktails since the war began. This is indicative that a considerable proportion of young men do not want to be called up...

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Still no decision on the EU's oil imports sanction against Russia
HUNGARY - In Brief 06 May 2022
The intra-EU debate on how much economic damage individual member states should take and over what period due to the intended ban on oil imports from Russia continues. At present, there are five members asking for exemptions, all on temporary basis: Austria, Bulgaria, Czechia, Hungary and Slovaki...