Filtered by Region: Emerging Markets Use setting Emerging Markets
Inflation rises, but Banxico still on course for a 50bp cut next week Mexico’s headline inflation rate edged up to 3.9% y/y in April, but we think that the challenging growth outlook and the relative resilience in the peso leave the door open for another …
8th May 2025
Copom hikes again, but tightening cycle near an end (if not already over) Brazil’s central bank hiked the Selic rate by a further 50bp, to 14.75%, today and officials made clear in the accompanying statement that the tightening cycle is near an end. We …
7th May 2025
NBP cuts by 50bp ... but easing cycle may be more limited than most expect The decision by the National Bank of Poland (NBP) to cut its policy rate by 50bp today, to 5.25%, rather than opt for a smaller 25bp cut, suggests a slightly more dovish balance on …
CNB cuts by 25bp, but easing cycle may now be over The Czech National Bank (CNB) cut its policy rate by 25bp today, to 3.50%, but we think that this may mark the end of its easing cycle. Our forecast for the policy rate to remain on hold at 3.50% over the …
Simion’s lead leaves Romania on the verge of a big political shift Far-right candidate George Simion emerged as the clear frontrunner in the first round of Romania’s rescheduled presidential election and is now the favourite to win the second round on 18 …
5th May 2025
This Rapid Response has been amended from our original response to correct the food CPI figure. Fall in inflation paves the way for May rate cut The larger-than-expected fall in Polish inflation, to 4.2% y/y, in April, is probably enough to tip the …
30th April 2025
Hungary contracts ahead of tariff impact The Q1 GDP data released out of Hungary and Czechia showed that momentum in both economies slowed at the start of this year, with Hungary suffering a renewed contraction. The risks to our below consensus full-year …
MNB to stay on hold as above-target inflation persists The Hungarian central bank (MNB) left its base rate on hold today, at 6.50%, and despite downside risks to activity from US tariffs, we think its easing cycle will remain on pause throughout 2025. …
29th April 2025
Sentiment holds up well in the face of Trump’s tariffs The European Commission's Economic Sentiment Indicators for Central and Eastern Europe (CEE) provide a tentative sign that the impact of US tariffs on the region has been fairly contained so far. The …
Inflation rises but end of tightening cycle is near The further rise in Brazil’s headline inflation rate to 5.5% y/y in the first half of April means that Copom will press ahead with a 50bp hike in the Selic rate at its next meeting in early May. But …
25th April 2025
CBR drops tightening bias, rate cuts likely in Q3 The Central Bank of Russia (CBR) left its policy rate on hold at 21.00% again today and dropped the language in its statement that further interest rate hikes are possible. With inflation nearing a peak, …
Leadership signals policy flexibility in the face of trade uncertainty The Politburo has just concluded its April meeting which, as usual, focused on economic affairs. The communique signalled that monetary policy easing is still on its way and that …
Inflation rises, but Banxico more focussed on weak economy The rise in Mexico’s headline inflation rate in the first half of April, to 4.0% y/y, is unlikely to shift Banxico’s focus away from the weakness of the economy and we expect it to deliver another …
24th April 2025
The larger-than-expected fall in South Africa’s headline inflation rate to 2.7% y/y in March will give the Reserve Bank more confidence that its easing cycle can resume. We expect a 25bp reduction to 7.25% at the next MPC meeting in May followed by a …
23rd April 2025
Odds of a May rate cut shorten The weaker-than-expected Polish industrial production and wage data for March have increased the probability that the central bank (NBP) will restart its easing cycle at its next meeting in May, but that decision will still …
22nd April 2025
CBRT signals tight policy here to stay The decision by the Turkish central bank (CBRT) to hike its one-week repo rate by 350bp, to 46.00%, formalises the emergency monetary tightening delivered last month and is a strong signal of commitment to a tight …
17th April 2025
A final hurrah Export growth accelerated in March, as manufacturers rushed to ship goods to the US ahead of “Liberation Day”. But shipments are set to drop back over the coming months and quarters. We think it could be years before Chinese exports regain …
14th April 2025
Loan growth no longer slowing Bank loan growth accelerated for the first time in over two years last month, helping to take broad credit growth to a 10-month high. While some further gains are likely, we still expect a more modest pick-up compared to …
Trade war to exacerbate deflation Deflationary pressures persisted last month and will almost certainly deepen over the coming quarters as it becomes more difficult for Chinese firms to export their excess supply. CPI deflation eased from -0.7% y/y in …
10th April 2025
RBI’s easing cycle will run further than most expect The Reserve Bank of India’s (RBI’s) decision to cut the repo rate by another 25bps today to 6.00% comes as no surprise given the recent sharp drop in inflation and the headwinds from US tariffs. But the …
9th April 2025
Israel holds rates steady ahead of Trump-Netanyahu talks The Bank of Israel (BoI) left its policy rate on hold again today, at 4.50%, and sounded a bit more hawkish than at its previous meeting despite highlighting possibly quite a large hit to economic …
7th April 2025
Tariffs unlikely to bring forward rate cuts The communications accompanying the decision by the National Bank of Romania (NBR) to leave its policy rate on hold today, at 6.50%, highlighted two-sided risks to inflation and economic activity from US trade …
Softer inflation gives CBRT some breathing space The softer-than-expected Turkish inflation figure for March, of 38.1% y/y, suggests that the sell-off in the lira last month hasn’t exerted significant upwards pressure on consumer prices (yet). And as …
3rd April 2025
NBP remains on hold, although case for rate cuts starting to build The National Bank of Poland (NBP) left is policy rate on hold again today, at 5.75%, and while our forecast is for policy settings to remain unchanged throughout 2025, the risks of an …
2nd April 2025
Central Europe recovering, Russia faltering The rise in the manufacturing PMIs in Central Europe in March adds to evidence that the region is recovering from its recent soft patch. In contrast, the drop in Russia’s PMI suggests the economy may be starting …
1st April 2025
Services weakness holding back growth This report was first published on the 31 st March covering the official PMIs. We added commentary on the Caixin manufacturing PMI on 1 st April. The PMIs suggest that infrastructure spending is ramping up again and …
31st March 2025
Easing cycle paused, and space for additional rate cuts narrows The Czech National Bank (CNB) left its policy rate on hold today, at 3.75%, and we think that the scope for further interest rate cuts this year has become more limited. We had previously …
26th March 2025
MNB on hold, high inflation to tie new governors hands The Hungarian central bank (MNB) left its base rate unchanged today, at 6.50%, and we think its easing cycle will remain on pause throughout 2025 as inflation remains stuck above target. Analysts have …
25th March 2025
Weak data to bolster calls for monetary easing The weaker-than-expected February retail sales data out of Poland suggests that the economy may have slowed a bit more sharply than we had been anticipating this quarter. While this won’t prompt the central …
24th March 2025
CBR sounds slightly less hawkish at it leaves rates on hold The decision by the Central Bank of Russia (CBR) to leave its policy rate on hold at 21.00% today was accompanied by somewhat less hawkish communications. While we doubt the CBR will cut interest …
21st March 2025
Turkey’s central bank responds with a rate hike The decision by Turkey’s central bank (CBRT) to hike its overnight lending rate from 44% to 46% today suggests that policymakers have been spooked by the market volatility yesterday and are keen to reassure …
20th March 2025
Soft inflation keeps rate cut in play The weaker-than-expected South African inflation figure for February, of 3.2% y/y, keeps the door open for the Reserve Bank to lower the repo rate by 25bp (to 7.25%) at its meeting tomorrow. The outturn was unchanged …
19th March 2025
NBP on hold, talk of rate cuts in H2 may be premature The decision by the National Bank of Poland (NBP) to leave its policy rate on hold today, at 5.75%, was widely anticipated, but we think that interest rates will stay higher than most others expect …
12th March 2025
Inflation plunges, opening the door for first rate cut Egypt’s headline inflation rate slowed sharply from 24.0% y/y in January to a near three-year low of 12.8% y/y in February, which should pave the way for the Central Bank of Egypt (CBE) to start its …
10th March 2025
Period of strong growth comes to an abrupt end The sharp slowdown in Brazil’s GDP growth, to just 0.2% q/q, in the final quarter of last year confirms that the economy’s recent period of strong growth has come to an abrupt end. We now think the economy …
7th March 2025
Foreign and domestic demand both under pressure Export growth cooled over the first two months of 2025, with tariff front-running providing less of a boost to demand than we had anticipated. This slowdown comes before any substantial hit from tariffs, …
CBRT cuts again, easing cycle has further to run The communications accompanying the decision by the Turkish central bank (CBRT) to cut its policy rate by 250bp again today, to 42.50%, suggest that policymakers were reassured by the fall in inflation in …
6th March 2025
End-year rebound sets stage for stronger 2025 The 0.6% q/q rebound in South Africa’s economy in the final quarter of last year came on the back of an upwardly-revised 0.1% q/q contraction in Q3 and suggests that the recovery is back on track. We expect …
4th March 2025
Rebound in domestic demand could slow pace of rate cuts The strong 1.7% q/q expansion in the Turkish economy in Q4 appears like a setback to the central bank’s efforts to bring down high inflation, but we don’t think this data is enough to throw the …
28th February 2025
ESIs point to stronger growth, higher inflation The European Commission's Economic Sentiment Indicators for Central and Eastern Europe (CEE) suggest that regional growth may hold up a little better than we had been expecting in Q1. That said, firms’ …
27th February 2025
Softer price pressures pave the way for further rate cuts The smaller-than-expected increase in South Africa’s headline inflation rate, to 3.2% y/y, supports our view that the Reserve Bank can press ahead with its easing cycle over the coming months. The …
26th February 2025
Growth picks up, recovery to continue in 2025 Nigeria recorded a further pick-up in GDP growth to 3.8% y/y in Q4 of last year and, with inflation and interest rates set to fall sharply, we expect the recovery to continue over the coming quarters. The …
25th February 2025
MNB on hold ... and probably for some time The Hungarian central bank (MNB) left its base rate on hold again today, at 6.50%, and we think that its easing cycle will remain on pause throughout 2025. That’s a more hawkish view than the latest consensus …
Inflation jumps, Copom to deliver more tightening The jump in Brazil’s headline inflation rate to 5.0% y/y in the first half of February means Copom will almost certainly press ahead with another 100bp hike in the Selic rate to, 14.25%, at its March …
BoI leaves rates on hold, but getting closer to easing The communications accompanying the decision by the Bank of Israel (BoI) to leave its policy rate on hold again today, at 4.50%, were slightly less hawkish than at the previous meeting, and support …
24th February 2025
Polish economy starts 2025 on the front foot The stronger-than-expected activity data out of Poland for January suggest the economy has carried over some of the positive momentum from the end of last year. Alongside the recent strength of inflation, this …
Rates on hold, CBN to turn to easing soon The Central Bank of Nigeria confirmed today that its tightening cycle was at an end by leaving the policy rate at 27.50% today, and we think its attention will quickly turn to rate cuts, probably beginning in May …
20th February 2025
The eleventh-hour unprecedented postponement of South Africa’s 2025 Budget due to disagreements within the Government of National Unity on tax policy, suggest that it is domestic rather than foreign policy where the cracks in the coalition lie. The delay …
19th February 2025
The decision by the US and Russia to “lay the groundwork” to end the war in Ukraine marks a potentially significant turning point after three years of conflict. Negotiations will take time and the macroeconomic implications will depend on the features of …
18th February 2025
Economy struggling ahead of Hamas ceasefire The slowdown in Israeli GDP growth, to 2.5% q/q annualised, in Q4 suggests the drag on activity from rising tensions with Hezbollah last quarter was a bit larger than we expected. The recent ceasefires with …
17th February 2025
