BRAZIL ECONOMICS - Report 27 Jul 2015

Executive Summary Because of the declining tax revenue caused by the recession and the only partial approval by Congress of the proposed spending cuts, it was evident for some time that the primary surplus target of 1.1% of GDP for 2015 would not be met. But there was belief in a moderate redu...

BRAZIL POLITICS - Report 27 Jul 2015

President Dilma Rousseff will try to reverse her popularity losses. She will launch the Dialogue Brazil website, a digital platform to connect citizens with the government. She will also meet with governors on Thursday, July 30. In Brasília, the Central Bank sets the benchmark interest ...

SOUTH AFRICA - Report 27 Jul 2015

On July 23, 2015, the monetary authority of South Africa voted to increase the repo rate by 25 basis points. Such a move can be construed as a confirmation that the South African Reserve Bank has kept to its long-held assertion that it had embarked on an interest rate hiking cycle. Apparently,...

BRAZIL ECONOMICS - Report 27 Jul 2015

Last week, the finance and planning ministers announced that the primary surplus target for 2015 has been reduced from 1.1% to 0.15% of GDP. The targets for 2016 and 2017, which were previously set at at least 2% of GDP, have also been lowered, to 0.7% and 1.3% of GDP, respectively. None of these...

SOUTH AFRICA - Report 27 Jul 2015

After a year-long struggle to regain its membership of COSATU, SA’s largest private sector union, National Union of Metalworkers of South Africa (NUMSA) with an estimated membership of over 360,000 members, resolved to go on its own and form a new “union confederation” and launch its own “work...

CHINA FINANCIAL - Report 27 Jul 2015

Special points to highlight in this issue:

• The sustainability of China’s economic model and its dependence on debt has been a controversial topic far longer than it should have been, but while there is now a consensus that Chinese debt levels are very high and may put the countr...

TURKEY - Report 26 Jul 2015

Executive Summary

It has been a week of shocking developments in Turkish politics. After the Suruc bombing, Ankara declared war on ISIS, granting access to Coalition Air Forces in all of its airbases. As we write the Weekly Tracker (in the early morning hours), the Turkish Air Force ...

COLOMBIA - Forecast 24 Jul 2015

Executive Summary

What does the FARC really want from a peace agreement? We believe the answer can be found in those half dozen border provinces where the guerrillas derive most of their income, and where their investments and wealth are concentrated. We believe prospects for a deal ...

TURKEY - In Brief 24 Jul 2015

Twin terror may spell reelections

Turkey suddenly became the target of PKK and ISIS, as the former escalated attacks against police and alleged members of Islamist organizations, while the latter attacked Turkish NCOs at the borde...

UKRAINE - In Brief 24 Jul 2015

Scarce information is available on negotiations with creditors. What we know is that no agreement was reached so far while the IMF promised to pay money whatever happens on debt operations. In this co...

TURKEY - Report 23 Jul 2015

The Monetary Policy Committee left all key short-term rates unchanged as expected today – one-week repo rate at 7.5% and the O/N lending and borrowing rates at 10.75% and 7.25%, respectively (see chart).

The content of the statement is exactly the same with the previous one except for ...

SOUTH AFRICA - Report 23 Jul 2015

The South African Reserve Bank (SARB)’s Monetary Policy Committee (MPC) decided to increase the repo rate from 5.75 to 6.0% per year, effective Friday, July 24, 2015 (see Graph 1).

Graph 1

Repo rate, South Africa, Jul ’13 – Jul ‘15