Filtered by Region: Emerging Markets Use setting Emerging Markets
Contrary to many expectations in the aftermath of the BJP’s humbling in the general election, there is little evidence so far of Prime Minister Modi’s party shifting to more populist policymaking. And the risk of fiscal slippage has eased following …
15th October 2024
Fiscal boost needed as deflationary pressures build CPI inflation fell in September, as an increase in food inflation was outweighed by further decreases in energy and core inflation. Meanwhile, producer price deflation deepened further on the back of …
14th October 2024
Inflation declines, but another rate hike looking more likely Headline inflation fell to 8.6% y/y in Russia in September but this was a touch less than expected and the breakdown showed that core price pressures are easing only very slowly. It now looks …
11th October 2024
Kenya’s second consecutive 75bp cut Kenya’s lowered its policy rate by 75bp this week and continued disinflation alongside an improved external environment mean that Kenya will deliver further monetary loosening over the coming months. Similar trends are …
The Bank of Korea today cut interest rates by 25bps (to 3.25%), but tried to dampen speculation that it would cut rates at its final meeting of the year in November. With growth struggling and inflation low, we think it is too early to rule out another …
Consumer support and a larger deficit Tomorrow’s press conference will provide a platform for the Ministry of Finance (MoF) to reveal its fiscal plans. The stakes are high - most observers agree that recent stimulus announcements won’t amount to much …
China’s policy stimulus measures have generated large market moves but it is the fiscal element, which hasn’t been detailed yet, that has the potential to lift the economy. We’re not expecting a huge fiscal package and it may be less commodity-intensive …
10th October 2024
War concerns drive further hawkish tilt at the BoI The communications alongside the decision by the Bank of Israel (BoI) to leave its policy rate on hold again today, at 4.50%, underline that policymakers have grown more concerned about the escalation of …
9th October 2024
Brazil inflation rises, more Selic hikes incoming The rise in Brazil’s headline inflation rate to 4.4% y/y in September was mainly due to drought-related effects on food and electricity prices but, even so, it will reinforce the hawkishness of Copom and …
The Reserve Bank of India’s new-look MPC voted to keep the repo rate unchanged at 6.50% today as expected but struck a less hawkish tone in its communications, which included a change in the official policy stance to more neutral language. This …
Wage growth remains strong across much of Latin America and Central Europe (CEE), and that has stalled the disinflation process in services in particular. This supports our view that, in general, central banks in these regions will keep policy tighter …
7th October 2024
Israel’s economy has frequently bounced back from conflict throughout its history, but developments over the past week have raised the risk of permanent scarring to the economy from the ongoing hostilities across the Middle East. The latest ratcheting up …
4th October 2024
Easing cycle paused, and cuts in 2025 will be limited The decision by the National Bank of Romania (NBR) to pause its easing cycle today, leaving the policy rate at 6.50%, seems to reflect growing concern about the persistence of underlying inflationary …
CNY nears strong end of its trading band We regret to inform our readers that the chart and analysis in this section contained errors. We have added a corrected chart below. The original chart and analysis have also been retained for reference but should …
Is the US facing a hard landing, a soft landing or no landing? Have stimulus announcements fundamentally changed the China equities story? How should investors trade risks around the US election? Raymond James CIO Larry Adam joins Group Chief Economist …
The 2025 draft budget recently outlined by Russia’s finance ministry shows that, rather than falling next year as initially planned, defence spending will rise by more than 20% to hit 6.2% of GDP. While personal income and corporate tax hikes will help to …
3rd October 2024
The Nigerian naira has fallen by more than 70% against the dollar since President Tinubu came to office, which has contributed to a surge in inflation that has weighed on economic growth. There are signs that some of the benefits from a weaker …
China’s recent stimulus announcements are still at the top of many investors’ minds, at least judging by the high level of client interest in the online briefing we ran on the topic yesterday. We’ve wrapped up our answers to the most common questions we …
Access to commodities – particularly critical minerals – is a growing area of competition between China and the West. And those EMs with deposits of the minerals used in new and low-carbon technologies are likely to see higher investment and, ultimately, …
Stronger-than-expected inflation rules out rate cuts this year The smaller-than-expected decline in Turkey’s headline rate to 49.4% y/y in September will be a disappointment to policymakers at the central bank (CBRT), and supports our view that a …
The euro-zone has stalled, the US labour market is cooling and China has only belatedly announced stimulus measures. The world economy is entering what our latest Global Economic Outlook describes as “a soft patch” – but for how long and how soft? And …
2nd October 2024
NBP on hold, monetary easing in 2025 will be limited The decision by the National Bank of Poland (NBP) to leave its policy rate on hold again today, at 5.75%, was never in doubt, and we continue to think that the easing cycle won’t resume until mid-2025. …
The fall in the EM manufacturing PMI in September suggests that growth slowed last quarter and we think this will continue over the coming months. The PMIs did at least provide encouraging signs that price pressures continued to ease. The EM manufacturing …
1st October 2024
Note: the last chart was previously uploaded incorrectly and was corrected on the 8th October The pivot toward stimulus reduces near-term risks and should provide some much-needed support to an economy struggling with a softening labour market and a deep …
Sharp rise in PMI suggests economic recovery is on track South Africa’s manufacturing PMI rebounded in August, finally replicating the improvements we have seen in other survey indicators. A backdrop of interest rate cuts and improving supply conditions …
PMIs sink in Turkey and Russia The sharp fall in the manufacturing PMIs in Turkey and Russia in September provide further evidence that their economies are slowing. But the continued rise in the prices balances of the survey in Russia will be a concern …
Headline GDP growth in the Gulf economies will strengthen in 2025 as oil output cuts are unwound. But lower oil prices will prompt a turn to fiscal consolidation in most of the Gulf, causing growth in non-oil sectors to slow. Elsewhere, balance sheets in …
30th September 2024
This page has been updated with additional analysis since first publication. Stimulus measures will shore up near-term activity While the official PMIs held up okay in September, the Caixin PMIs dropped quite sharply which suggests that the economy lost …
Overview – A pivot towards fiscal and monetary stimulus should support China’s growth in the near-term. But the economy continues to be propped up by investment, still elevated levels of construction, and the willingness of trading partners to allow …
27th September 2024
CBN rate hikes about inflation and credibility The Central Bank of Nigeria’s surprise hike this week highlighted the greater progress that the MPC wants to see on the inflation front and also importantly its steadfast ambition to restore its trust and …
Inflation and growth backdrop supports further easing Mexico’s central bank delivered another 25bp interest rate cut at today’s meeting, to 10.50%, and the communications suggest that it will continue to ease policy over the coming months. We expect the …
26th September 2024
Most EM equities have fared well over the past week or so amid encouraging signs from China, the first Fed rate cut and broadening EM easing cycles. We think these equities will continue to fare well over the coming year, albeit not as well as US ones. …
China’s finance ministry appears to be lining up a fiscal support package to deliver on the Politburo’s pledge of additional support for the economy. If a report by Reuters is correct, the package could lift GDP by around 0.4% over the course of the next …
Capital inflows into EMs have rebounded over recent weeks amid the start of the Fed’s easing cycle. Looking ahead, we expect EM inflows to hold up well as global monetary conditions ease further. In general, EMs are not especially dependant on foreign …
Your one-stop-shop guide to global monetary policymaking includes two-year policy rate forecasts for all the major DM and EM central banks plus links to our latest meeting previews and reactions. If you have subscriber access to the data underlying this …
From pivotal central bank decisions to the most closely watched economic reports, this is your guide to the key events and data releases for the coming week. Click on the button above to view in full-screen mode. … Week-ahead …
Explore our forecasts to end-2026 for GDP growth, inflation, policy rates and commodity prices. To explore our policy rate forecasts in more detail, please visit our Central Bank Hub dashboard. If you have subscriber access to the data underlying this …
CNB cuts by 25bp again, easing cycle has further to run The decision by the Czech National Bank (CNB) to cut its policy rate by a further 25bp today, to 4.25%, was followed by communications which, on balance, felt a bit more dovish than at the last …
25th September 2024
Table of Key Forecasts Overview – Aggregate EM growth is entering a softer patch, despite the tailwind from the Fed’s easing cycle. Growth concerns will prompt central banks in much of Asia to cut interest rates. But stubborn inflation pressures elsewhere …
Cardoso’s surprise 50bp hike may not be the last The Central Bank of Nigeria surprised many by raising its policy rate by 50bp to 27.25%, at its meeting today, and Governor Cardoso’s hawkishness about the risks emanating from sticky inflation, energy …
24th September 2024
Easing cycle resumes ... for now The communications accompanying the decision by the Hungarian central bank (MNB) to resume its easing cycle today suggests that the central bank could pause interest rate cuts again very soon. We expect just one further …
Our China Activity Proxy suggests that growth slowed in August, with construction seeing the sharpest deceleration. Alongside today’s monetary easing, an uptick in fiscal spending will help keep the economy afloat over the rest of this year, but it won’t …
Saudi Arabia’s Vision 2030 reform programme has resulted in major societal and cultural changes, but many of the economic reforms are currently not on track to hit their targets. That is not to say Vision 2030 should be dubbed a failure. But officials …
23rd September 2024
After the long-awaited start to the Federal Reserve’s easing cycle, Group Chief Economist Neil Shearing discusses next steps. He answers client questions about the risks of inflation bouncing back and explains why we expect rates to settle at levels much …
20th September 2024
After the Fed recently delivered its first rate cut, we look at previous US loosening cycles to analyse how emerging markets assets have performed. This time around we expect the US to skirt a recession, and our view is that most of the easing cycle is …
Tailwind from Fed’s easing cycle will be small The US easing cycle that got underway with a 50bp cut this week will provide a boost to economic activity in Hong Kong, where a fixed exchange rate means interest rates track those in the US. We expect the …
The South African Reserve Bank finally joined the EM easing cycle today, lowering its repo rate by 25bp to 8.00%. While the MPC clearly has some lingering concerns about the inflation outlook, we think sluggish growth and at-target inflation will provide …
19th September 2024
PIF investment in Egypt: the first of many? Saudi Arabia’s Public Investment Fund (PIF) has pledged to invest $5bn into Egypt in a further sign that March’s policy shift is attracting international attention. At the same time, this will help to put …
SARB cautiously cuts by 25bp The South African Reserve Bank finally joined other EM economies in starting its monetary policy easing cycle, lowering its repo rate by 25bp to 8.00%. While the decision to cut was unanimous, the MPC did consider both holding …
Overview – Headline GDP growth in the Gulf economies will strengthen sharply in 2025 as oil output cuts are unwound. But lower oil prices will prompt a turn to fiscal consolidation in most of the Gulf, causing growth in non-oil sectors to slow. Elsewhere, …
