The Signs of Economic Activity
BRAZIL ECONOMICS · Report · 19 Jun 2017

Last week was filled with positive data on April’s economic activity, suggesting the recovery recorded in the first quarter might extend to the second. Along with the continuing fall of the interest rate, other forces are also acting in the direction of economic recovery, but even though the wors...

No change in policy rate expected
PHILIPPINES · In Brief · 16 Jun 2017

How likely is it that the BSP will raise interest rates when the Monetary Board meets on Thursday, June 22? The question has come up following the US Fed’s decision to hike its policy rate by 25bp on Wednesday. The move brought the cumulative increase in the US policy rate since December last yea...

​CHP deputy sent to prison, chairman hits the road
TURKEY · In Brief · 15 Jun 2017

First, allow me to remind my audience that I'll be out of the country until 1st of July during which time my access to e-mail will be limited. If you need to contact me, GlobalSource Partners NYC office is your best bet. I had sincerely hoped that you wouldn’t have to, since up until a day ago, p...

Farmer protests, loan waivers and fiscal deficits
INDIA · Report · 15 Jun 2017

The recent decline in food prices and rural stress are causing farmers to protest in some parts of India. Police firings have led to six deaths in Madhya Pradesh. After two years of drought, demonetization hit the cash economy of rural India hard. The cash ban brought rural markets to a halt, pus...

Online Politics
RUSSIA / FSU POLITICS · Report · 15 Jun 2017

The Moscow Mayor’s Office launched a large-scale city renovation plan that means tearing down thousands of apartment buildings and offering home owners new ones. City-wide discussions resulted in tens of thousands of people protesting, and the city leadership’s goal at this stage is to prevent op...

MPC Remains On Hold As Expected
TURKEY · Report · 15 Jun 2017

The Monetary Policy Committee’s decision was broadly as expected. The Bank kept all its rates unchanged, i.e. the Late Liquidity Window (LLW) at 12.25%, the O/N lending and borrowing rates at 9.25% and 7.25%, respectively and the one-week repo rate at 8.0%.

2017–2019 Forecast: Autocracy vs Reforms
VENEZUELA · Forecast · 14 Jun 2017

With a crashing economy and an unpopular regime trying to entrench its power, anything can happen in Venezuela over our 2017–2019 forecast horizon. We construct two scenarios that we consider equally likely, one in which Maduro’s government persists (“Autocracy”) and another in which it is replac...

Politics: Everyone wins, and everyone loses
MEXICO · Report · 13 Jun 2017

Although the PRI managed to pull off two close yet crucial victories in gubernatorial races at the beginning of the month, its share of the vote was halved in both states, and its barefaced abuse of public resources, apparent ballot-stuffing and theft of ballot boxes, as well as heavy-handed mana...

Economics: Inflation Likely to Head Lower
MEXICO · Report · 13 Jun 2017

Since the middle of 2016 we have witnessed a rebound in inflation in response to a series of “shocks”, and while we expect a point of inflection to be registered in the near future, at this point it is more important to determine when and at what pace such an ebbing of price pressures might occur...

“Original” chavismo: New actor on stage
VENEZUELA · Report · 13 Jun 2017

A new actor is on the Venezuelan stage: the "original" chavismo, grouped around Chief Prosecutor Luisa Ortega Díaz. Ortega is discharging her institutional duty by opposing Maduro’s National Constituent Assembly (ANC) initiative. She is linked to “original“ chavistas who criticize Maduro and stan...

Synthesis of the Brazilian Economy
BRAZIL ECONOMICS · Report · 12 Jun 2017

The revelation of the content of the secret recording of the off-agenda meeting between Temer and Joesley Batista triggered an important change in the political and economic scenarios, increasing uncertainty and jeopardizing the continuity of the reforms advocated by the economic team. The contro...

Week of June 12
BRAZIL POLITICS · Report · 12 Jun 2017 · 1 response

The Thursday holiday means reduced legislative activity. The main political event of the week is the PSDB meeting to decide whether it will remain in the governing coalition. The Constitution and Justice Committee of the Lower House may vote on the Constitutional Amendment proposal on direct elec...

GDP and BOP Prints: Initial Reactions
TURKEY · Report · 12 Jun 2017

The economy grew at a better-than expected 5% pace in Q1, y/y, compared with the consensus (and our) forecasts of around 3.5%. Our forecast slippage stemmed from stronger growth in both private and public consumption, which were markedly higher than the rates we had factored into our bottom-up ap...

Disinflation, Uncertainty and Falling Interest Rates
BRAZIL ECONOMICS · Report · 12 Jun 2017

Inflation is decelerating further still, and the signs indicate it will be significantly below the target at year-end. Because of the huge slack in the production factors and anchored inflation expectations, there is room for the Central Bank to continue its easing cycle. However, the Central Ban...

Inflation shoots up
VENEZUELA · Report · 12 Jun 2017

We forecast month-on-month inflation shooting up to 26 percent in June, and revise upward our May estimate to 22 percent (from 18 percent in our previous report). The year-to-date inflation rate for the first half of 2017 rises to 184 percent and the year-on-year rate goes up to 627 percent.