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Growth Smooth, and Picking Up
UKRAINE · Forecast · 04 Oct 2016

The Ukrainian economy has returned to a smooth growth trajectory. Absent any unexpected news, or shifts in macroeconomic trends, it’s hard to be displeased. External demand remains weak, and will hardly become a near-term driver of growth, though internal consumption has recovered steadily, which...

The European crisis in seven steps
CHINA FINANCIAL · Report · 04 Oct 2016

As much of a threat China’s high and rising debt burden has become to its continued growth, the biggest risks to the global economy probably lie in Europe, and especially in its banking system. • Growth rates in peripheral Europe continue to be revised downwards, and deadlines for budget deficit...

Political transition seems inevitable
VENEZUELA · Report · 04 Oct 2016

Political tensions are high in Venezuela. Everyone expects a transition soon, but no one is certain when it will happen or who will control it. After a long delay, the National Electoral Council (CNE) announced that the second of three stages in the presidential recall process—the collection o...

​MPC cuts rate
INDIA · In Brief · 04 Oct 2016

In its first meeting following being given a legal mandate to target inflation, RBI cut the policy rate by 25 basis points. This was in line with what I had suggested in my note over the weekend titled “First meeting of RBI’s MPC” before the meeting started. The decision was unanimous, as expecte...

Feedback on the IMF Memorandum: Next Wire Will not be Soon
UKRAINE · In Brief · 04 Oct 2016

Yesterday the IMF Memorandum was finally released. Our impression from the document – this year prospects for next wire are slim. At the document the IMF talks about submission of law on agriculture land circulation to the parliament and about utility-related social assistance program adjustment ...

Week of October 3
BRAZIL POLITICS · Report · 03 Oct 2016 · 1 response

The results of the municipal elections on Sunday, October 2, will have a big impact in Brasília, where parties will analyze their performance and define strategies for the runoff round. In the House, the Federal Spending Amendment will be voted upon in the Special Committee. Congressmen may vote ...

Not much new in proposed budget bill for 2017; no change in deficit of the NFPS
DOMINICAN REPUBLIC · In Brief · 03 Oct 2016

Last week, the Council of Ministers, headed by President Medina approved the proposed budget bill for 2017, which will be presented to Congress in the coming days. The official document of the budget still has not been published (it will at any time) so there is not much information available. Ho...

Supply-Side Reforms Succeeding
CHINA · Report · 03 Oct 2016

Key economic indicators are signaling positive changes. Fixed asset investment was up 8.1% y/y in August, and up 4.2 pps from July, recovering to Q2 levels, and halting its declining trend. Industrial output was up 6.3% y/y, and up 0.3 pps from July. Retail sales of social consumption goods were ...

A Cooperative Game Between Fiscal and Monetary Policies
BRAZIL ECONOMICS · Report · 03 Oct 2016

The solution to Brazil’s fiscal crisis requires not only tough measures like approval of the Proposed Constitutional Amendment (PEC) to limit spending in real terms and the social security reform. Without a return of economic growth, there will be no revenue growth or a return to primary surpluse...

The Horses of History
COLOMBIA · Report · 03 Oct 2016 · 2 responses

Colombians voted a troublesome 50.21%-49.78% favoring NO in the October 2 plebiscite on the peace agreement with the FARC. Regionally, the results reveal a worrisome pattern; the geographical core of the country, composed by relatively more affluent provinces, and where the largest cities sit, vo...

Good Inflation Print, More Cuts in Store
TURKEY · Report · 03 Oct 2016

Consumer price inflation surprised on the downside in September, coming in at 0.2%, m/m, softer than the consensus expectation of a 0.7% increase. The 12-month rate hence fell visibly to 7.3% from just over 8% in August. Producer prices stayed very benign, suggesting little cost-push pressure, dr...

Referendum proved invalid by a substantial margin
HUNGARY · In Brief · 03 Oct 2016

Well, yesterday's vote almost came out as forecast by the polls. The difference from poll forecasts was that turnout ended up weaker than expected - only 40.4% of eligible voters showed up and cast a valid vote - and that of all valid votes, an unexpectedly high share - 98.3% - supported the gove...

Extending the SoE is a bad idea
TURKEY · In Brief · 02 Oct 2016

After a week abroad (which caused me to skip the Weekly Tracker on Sunday), I returned to Turkey amidst rumors of a second coup plot, which were taken seriously by the government. Interior Minister Mr. Suleyman Soylu bravely claimed that potential plotters would feel “the baton of justice” on the...

​ First meeting of RBI's MPC
INDIA · In Brief · 02 Oct 2016

A new arrangement The first meeting of the newly constituted Monetary Policy Committee of the Reserve Bank of India will take place on October 3 and 4. The decision of the MPC will be final and the repo, rate will be set as decided by the committee. This is a break from past practice where the RB...

Growth reaches 4.9% in H1 forces weakens prospects for the rest of the year
PANAMA · Report · 30 Sep 2016

Real GDP grew 5.2% y/y in Q2 compared to 4.6% in Q1; growth in H1 was 4.9%, which suggests a growth rate for 2016 below the 6% estimates of the Panamanian Government and international agencies. The leading sectors were: electricity, gas and water supply; mining, construction and financial interme...