Country Insights

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IPCA: End of a Benign Period
BRAZIL ECONOMICS - Report 09 Oct 2013
In September the IPCA rose 0.35%, greater than the increase of the IPCA-15 for that month (0.27%). With this, inflation over the preceding 12 months accumulated a variation of 5.86% (Graph 1). The IPCA for September should mark the end of a cycle of about four months of relatively benign monthly ...

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MTP 2014-16: Cozy But Unlikely
TURKEY - Report 09 Oct 2013
The authorities’ Medium-Term Program (MTP) for 2014-16 was announced yesterday. The revisions made to the three main macro aggregates and our quick thoughts on them are summarized below. Table 1 below provides the key macro indicators for the current and previous MTPs, while annex tables (1-4) pr...

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On Rafael Ramirez's Appointment
VENEZUELA - In Brief 08 Oct 2013 2 responses
Rafael Ramírez replaces Nelson Merentes as Vicepresident for the Economic Area (Decree No. 457, Official Gazette No. 40,266 , 7 October 2013). Merentes will probably soon leave the Ministry of Finance and take an official position abroad. His departure materializes his failure to liberalize the e...

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MTP 2014-16: And Then, a Miracle Happens…
TURKEY - In Brief 08 Oct 2013
The Medium-Term Program for 2014-16 was announced today, somewhat earlier than expected.  The government revised down the growth rate for this year to 3.6% and for the next year to 4%, from previous MTP’s 4% and 5%, respectively.  Inflation is forecasted to end the year at 6.8%, vs. the 5.3% in t...

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Budget Deficit Target for 2014: 2.8% of GDP; USD 1.5 bn in Sovereign Bonds; GDP Growth: 4.5%
DOMINICAN REPUBLIC - In Brief 08 Oct 2013
In compliance with the Constitutional deadline, last week the Executive presented to Congress the budget bill for 2014.  The proposed budget sets a deficit target equivalent to 2.8% of GDP, a level similar to that for 2013. Although no one was expecting a drastic reduction in primary spending giv...

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SA Political Economy Dilemmas - October 2013
SOUTH AFRICA - In Brief 08 Oct 2013
The IMF Article IV puts the “cat amongst the pigeons” in South Africa’s highly charged political economy environment.  Over the past year or so, South Africa’s labour unions have raised the political and ideological temperature substantially. A blend of binding factors has been at play. Declining...

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Government Spending: Back to 2011?
PHILIPPINES - In Brief 08 Oct 2013
The Finance Department reported today that government non-interest expenditures grew 7.4% in August, significantly down from 30% the previous month and double-digit growth rates since April.  While we would like to see more data points before drawing a definitive conclusion, this slowdown may sig...

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Passing a Point of Inflection
MEXICO - Report 08 Oct 2013
Economic Panorama Last week we discussed the factors that have most contributed to the way in which the Mexican economy began to get bogged down during the first half of the year. In this edition we turn our attention to updated indicators – such as Mexico’s monthly GDP proxy (Index of Global Eco...

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Democratization Package update: Don’t Expect More, but Less
TURKEY - In Brief 07 Oct 2013
I’m asked by a lot of readers whether the recently unveiled Reform or Democratization Package heralds the return of the “pragmatic, reformist” AKP.  The answer is unfortunately NO.  In fact instead of adding to the gains by supplemental initiatives addressing the groups neglected in the first pac...

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Normalisation of Monetary Policy Continuing
INDIA - In Brief 07 Oct 2013
RBI had embarked on a messy interest rate defence of the rupee where the 91-day rate moved up by as much as 400 bps. After Raghuram Rajan took charge as Governor, some small steps were taken in normalisation.Today, the next step in normalisation took place. RBI cut the marginal standing facility ...

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Sweeten the Pot
MEXICO - Report 07 Oct 2013
Executive Summary Last week GEA-ISA published the results of its most recent quarterly survey of voter opinion, which on this occasion focused on issues related to proposed fiscal and energy reforms. The public finds little it agrees with in the structural reform proposals offered to date, with c...

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Political Insights: Week of October 7
BRAZIL POLITICS - Report 07 Oct 2013
In the economy, two highlights: the Central Bank announces its decision on the interest rate, and the IBGE releases inflation figures for September. In the Senate, we highlight the resumed discussions on the unification of ICMS and state debt, as well as the possible vote, in the Constitution and...

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Improved Trade Balance in September: Effect of the Real Exchange Rate Still Small
BRAZIL ECONOMICS - Report 07 Oct 2013
Brazil’s trade balance in September was in surplus by US$ 2.1 billion, indicating recovery. On a seasonally adjusted basis, the annualized surplus of US$ 16.4 billion is the largest since the end of last year (Graph 1). However, this result cannot be attributed to the weaker real exchange rate. G...

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Weekly Tracker: October 6-12
TURKEY - Report 06 Oct 2013
Executive Summary On the international front, there is only a remote hope of progress in the Iran vs. P5+1 negotiations, or in Syria, while Iraq is in tenterhooks. As regional conflicts spread out, contagion to Turkey through terror and ethnic strife may become more apparent. Kurds rejected the R...

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Stability Reaffirmed
RUSSIA / FSU POLITICS - Report 04 Oct 2013
Sergei Sobyanin won the Moscow Mayor’s election but with a small voter turnout, and voter support for himself only marginally higher than 50%. That may cause his position in the elite hierarchy to become less prominent. His main opponent, Alexey Navalny, won more than a quarter of the vote, despi...