CBRT Lifts End-Year Inflation Forecast to 38%

May 9, 2024 10:22 AM UTC

Bottom Line: Central Bank of Turkiye (CBRT) released the second quarterly inflation report of the year on May 9, and lifted end-year inflation prediction from 36% to 38% citing that the rebalancing process for demand will be more delayed compared to what was projected that in the first inflation rep

China Equities: A Tactical Play

May 8, 2024 2:20 PM UTC

China equities can see a tactical bounce of 5-10% in the coming months.  Cheap valuations and  underweight global fund positions means that the scale of pessimism only has to get less bad on the economy and China authorities attitude towards businesses.  While we see a tactical opportunity, we do

Ukraine War Update: Major Russian Offensive is Expected This Summer Despite U.S. Military Aid

May 8, 2024 12:06 PM UTC

Bottom Line: The offensives at the front lines started to pick up steam after March/April as the Russian forces plan for their larger summer 2024 offensive operation, aiming to seize more territory before the U.S. presidential elections in November. In the meantime, U.S. approved a $61 billion warti

Russian Economy Expands by 4.2% YoY in March, and 5.4% in Q1

May 3, 2024 2:14 PM UTC

Bottom Line: According to the figures announced by the Russian Ministry of Economic Development, Russia's GDP grew by 4.2% YoY in March owing to strong fiscal stimulus, high military spending, invigorating consumer demand and investments. We now foresee Russian economy will expand by 2.6% in 2024

Turkiye’s Inflation Continues to Jump in April with 69.8%

May 3, 2024 7:40 AM UTC

Bottom Line: Turkish Statistical Institute (TUIK) announced on May 3 that Turkish CPI ticked up 69.8% annually and 3.2% monthly in April due to increases in transportation, restaurant & hotel and education prices, coupled with the lingering impacts of the wage hikes on the services sector. We feel u

China Politburo: Help for Housing, But No Game changers

May 2, 2024 10:50 AM UTC

Politburo statement in late April suggests extra support for residential property.  However, we see this as being incremental rather than any game changers and we still see residential investment remaining a negative drag on 2024 GDP growth.

South Africa’s Fiscal Outlook Under Spotlights as the Elections Are Approaching

May 1, 2024 6:45 PM UTC

Bottom line: South Africa policy makers remain concerned about government debt trajectory, large domestic and international financing needs and elevated country risk premium before fast-approaching elections on May 29. We think South Africa’s general government fiscal balance and debt trajectory w

China: Depreciation Rather Than Devaluation

April 29, 2024 1:00 PM UTC

We feel that a devaluation of the Yuan is unlikely in 2024, both to avoid potentially politically destabilizing capital outflows but also to avoid upsetting the next U.S. president.  Policy is geared more towards controlled depreciation to help competiveness but reduce other risks.  The Yuan has a

Indonesia: MPC Review: Bank Indonesia Surprises With A Rate Hike

April 29, 2024 11:26 AM UTC

In a pre-emptive move to both curb inflationary pressures and safeguard the Indonesia Rupiah (IDR) against furhter depreciation, Bank Indonesia, in a surprise move, increased its main policy rate by 25 bps to 6.25%. However, further rate hikes are not expected as the central bank remains wary of hur

Headwinds To Long-term Global Growth

April 26, 2024 9:30 AM UTC

Bottom line: While much focus is on the cyclical economic position to determine 2024 monetary policy prospects, the 2025-28 structural growth trajectory differs to the pre 2020 GDP trajectory for major economies.  While global fragmentation has a role to play, aging populations are already having a

China: Surging Government Debt and Does It Matter?

April 24, 2024 9:30 AM UTC

Total non-financial sector debt, plus the IMF estimates of government debt/GDP, do seem to matter for the action of China authorities, as fiscal policy stimulus is targeted rather aggressive as in 2009 or 2015.  The overall debt picture also matters for the growth outlook, as the excess debt/GDP le

Sticky Inflation Causes Concerns over the Horizon

April 24, 2024 9:26 AM UTC

Bottom line: According to the Monetary Policy Review Report by the South African Reserve Bank (SARB) on April 23, the risk of higher inflation still remains and inflation returning to the midpoint of the target band is only expected in the last quarter of 2025. SARB highlighted in its report that ma

Indonesia: MPC Preview: Bank Indonesia to Hold Rate Despite Currency Volatility

April 23, 2024 11:12 AM UTC

With inflation within target range and the need to defend the currency amid global uncertainties and US dollar strength, Bank Indonesia (BI) is likely to extend its pause on rate adjustments in the upcoming monetary policy meeting on April 24. BI remains committed to stabilising the Indonesian rupia

Country Risk in MENA

April 23, 2024 9:00 AM UTC

Country risk in Middle East and North Africa is impacted by the ongoing war in Gaza.     

Indonesian Court Delivers Verdict: Prabowo prevails

April 22, 2024 3:18 PM UTC

The Constitutional Court dismissed cases against Vice President Gibran Rakabuming Raka and President Joko Widodo. In Gibran's case, the court didn't disqualify him from running for president but sanctioned the election committee for not amending regulations following a previous ruling. This ruling l

EM Europe/CIS: Country Risk Ratings

April 22, 2024 9:00 AM UTC

We provide country risk reviews for EM Europe/CIS countries including Russia and Ukraine. 

Recent Polls in South Africa: ANC’s Popularity Continues to Decline

April 19, 2024 1:14 PM UTC

Bottom line: We continue to foresee two possible outcomes of South African presidential elections on May 29, either an African National Congress (ANC) win or a coalition government. According to recent polls, ANC is at the serious risk of losing its majority dipping below 50%, even as low as 37% acc

Services Surplus and Decreasing Trade Deficit Partly Heal Turkish Current Account Deficit

April 19, 2024 12:18 PM UTC

Bottom Line: Turkiye’s annualized current account deficits (CAD) stood at $31.8 billion as of February 2024 when compared to $37.6 billion a month earlier, driven by a marginal increase in the services surplus, a reduction in the gold trade deficit, and a recovery in net energy trade. We envisage

China and the South China Sea

April 18, 2024 2:00 PM UTC

 Bottom Line: A China coastguard vessel blocked two Philippines government vessels over the weekend in the Second Thomas shoal area near the Philippines, which has raised questions over whether the South China Sea will be another geopolitical flashpoint.  We would say not in 2024, both given China

Asia Country Risk Ratings

April 17, 2024 3:00 PM UTC

We provide country risk reviews for Asia countries including China, India, Indonesia, Malaysia, Philippines, Thailand and Taiwan.  

Markets: Fed Rather Than Middle East Worries

April 17, 2024 12:34 PM UTC

Global markets are being driven by a scale back in Fed easing expectations and we see a 5-10% U.S. equity market correction being underway.  However, with the market now only discounting one 25bps Fed cut in 2024, any downside surprises on U.S. growth or better controlled monthly inflation numbers

India Inflation: Risks Tilted to the Upside

April 15, 2024 12:35 PM UTC

India's inflation trajectory in March 2024 showcased divergent trends in both consumer and wholesale price indices. While consumer inflation dipped to its lowest in ten months at 4.9% y/y, wholesale inflation rose to 0.5% y/y, driven by surging food prices. The outlook suggests gradual WPI escalatio

Russian Economy Expands by a Strong 7.7% YoY in February

April 11, 2024 7:38 PM UTC

Bottom Line: According to preliminary figures announced by the Russian Ministry of Economic Development, Russia's GDP grew by 7.7% YoY in February after expanding by 4.6% in January, owing to strong fiscal stimulus, high military spending, invigorating consumer demand and investments. We foresee R

Russia’s Inflation Remained Steady at 7.7% in March

April 10, 2024 8:21 PM UTC

Bottom Line: After hitting 7.4% YoY in January and December, the inflation rate remained stable at a one-year peak of 7.7% YoY in March after February. We think stubborn price pressures continue to be strong due to high military spending, currency weakening particularly after March 11, tight labour

Brazil CPI Review: Inflation Decelerates in March

April 10, 2024 2:57 PM UTC

The latest CPI data from Brazil reveals a modest increase of 0.16% (m/m) in March, slightly below market forecasts. Despite this, the year-on-year CPI has dropped to 3.9%, remaining within the BCB bands but above the central target. Notably, the Food and Beverages group saw the most significant rise

Turkiye’s March Inflation Ticks Up to 68.5% Despite Continued Tightening

April 3, 2024 9:16 AM UTC

Bottom Line: Turkish Statistical Institute (TUIK) announced on April 3 that Turkish CPI surged to 68.5% annually and 3.2% monthly in March, and annual inflation swung to a 16-month high due to increases in food and education prices, coupled with the lingering impacts of the minimum wage hike on the

March Outlook: Europe in Focus, Then Elections Around the World

April 3, 2024 9:00 AM UTC

Asset Allocation: Pausing for Breath

April 2, 2024 9:00 AM UTC

Into Q2, data and policy (actual and perceived) will dominate DM markets. The ECB will likely take the spotlight with a 25bps cut on June 7, as the Fed face a better growth/more fiscal policy expansion and a tighter labor market than the EZ but also with a better productivity backdrop and outlook to

Indonesia CPI Review: Ramadan Demand Drives Up Inflation

April 1, 2024 1:33 PM UTC

Indonesia's latest Consumer Price Index (CPI) data has revealed a notable acceleration in inflation, surpassing expectations and marking the highest rate since August 2023. The surge, driven primarily by heightened demand during the fasting month of Ramadan, highlights significant price pressures ac

Outlook Forecasts to download in Excel

March 27, 2024 11:06 AM UTC

Below is an Excel file that contains our headline forecasts for GDP, Inflation, Monetary Policy, and Exchange Rates.

March Outlook: Europe in Focus, Then Elections Around the World

March 27, 2024 9:00 AM UTC

EMEA Outlook: Elections Set the Scene in Q2

March 25, 2024 2:00 PM UTC

·     Unlike South Africa and Russia, Turkiye continued with tightening monetary policy in Q1 due to stubborn inflation, pressure on FX and reserves. Meanwhile, Russia and South Africa halted their tightening cycles as of 2024 and will likely start cutting interest rates in Q3 depending on how

Outlook Overview: Europe in Focus, Then Elections Around the World

March 25, 2024 11:15 AM UTC

LatAm Outlook: Getting Deeper in the Cutting Cycle

March 22, 2024 7:04 PM UTC

·       Brazil and Mexico growth will decelerate from the growth rates seen in 2023. The stronger basis of comparisons in 2023 and the tight monetary policy will diminish growth during 2024. Brazil robust agricultural growth will not repeat in 2024, while Mexico growth is restrained by a tigh

Asia/Pacific (ex-China/Japan) Outlook: Election Spending to Drive Growth

March 22, 2024 12:18 PM UTC

·       In 2024, growth trends across emerging Asia will exhibit a mixed pattern. Encouragingly, there will be a resurgence in demand for global electronics following a period of stagnation in 2022‑23, which will provide a boost to regional trade. Moreover, the initiation of monetary policy

Commodities Outlook: A Promising Horizon

March 21, 2024 11:00 AM UTC

South Africa’s Inflation Hits 4-Months High in February

March 20, 2024 1:37 PM UTC

Bottom Line: According to the inflation figures announced by Department of Statistics of South Africa (Stats SA) on March 20, the inflation jumped to 5.6% YoY in February due to higher housing & utilities, miscellaneous goods & services, food and non-alcoholic beverages and transport prices, couple

China Outlook: The Struggle to Hit 5% Growth

March 20, 2024 11:00 AM UTC

China’s 5% growth target will likely be tough to meet with residential property investment likely to knock 1.0-1.5% off GDP and net exports a small negative. With sluggish private investment, this means some of the old engines of growth are not firing.  Some additional fiscal stimulus will likely

Bank Indonesia to Retain Policy Rate

March 18, 2024 5:40 AM UTC

Bank Indonesia (BI) will likely maintain the key 7-day reverse repo rate unchanged in March at 6%, in line with recent trends. The stability of the rupiah remains a crucial consideration for BI, alongside CPI inflation, which has moderated within the new target band of 2.5+/-1%. 

Russian Presidential Election: Putin Moves Towards His Fifth Term in Kremlin

March 15, 2024 10:29 AM UTC

Bottom line: We foresee two possible outcomes of Russian presidential election on March 15-17, either a Putin win (99%) or a second round on April 7 (1%), despite the latter has a very small chance to occur. We think Putin will secure his fifth term in Kremlin despite there are alleged concerns that

Russia’s Inflation Remained High at 7.7% in February

March 13, 2024 9:33 PM UTC

Bottom Line: After remaining unchanged at 7.4% YoY in January and December, we saw an uptick in the inflation hitting 7.7% in February. We think stubborn price pressures continue to be strong due to high military spending, currency weakening, tight labour market, high salaries and benefits, and invi

Brazil CPI Review: 0.8% Growth in the month but Stable on Annual Terms

March 12, 2024 6:55 PM UTC

The Brazilian National Statistics Institute (IBGE) released February's CPI figures, slightly exceeding market expectations at 0.82% (m/m), maintaining the Y/Y index at 4.5%. Notably, the rise was seen in the Educational group, alongside gasoline prices (+2.48%) and a drop in airfare tickets (-10.4%)

Elections to Keep Asia in Limelight in 2024

March 11, 2024 9:05 AM UTC

2024 is turning out to be a significant year for the Asian political scene. At the start of the year, eight countries were scheduled to hold elections this year, with close to 2.2bn people voting this year across emerging Asian economies. 
With elections now over in four of the eight countries, the

India's Q3 GDP: Strong But Uneven Growth

March 8, 2024 2:30 PM UTC

India's economic landscape witnessed a remarkable upswing in Q3-FY24, with a real GDP growth rate of 8.4%,  surpassing both street estimates and the Reserve Bank of India's (RBI) projections. This surge not only solidifies India's position as the fastest-growing major economy globally but also unde

Country Risk in MENA

March 8, 2024 11:00 AM UTC

Country risk in Middle East and North Africa is impacted by the ongoing war in Gaza.     

Turkiye: AKP Wants to Win Major Cities Back on March 31

March 7, 2024 2:37 PM UTC

Bottom line: Unless something unforeseen occurs, we think Justice and Development Party (AKP) will likely remain the highest rated party in the Turkish local elections on March 31, winning more local municipalities than any other parties in Turkiye. Despite AKP’s main target is to win back the maj