Global Markets Update Taking stock of EM market performance in previous RMB falls There have only been three previous occasions in the last decade when the renminbi has depreciated to any meaningful extent against the dollar. On two of those occasions the performance of EM markets... 13th August 2015 · 1 min read
China Economics Update RMB set to stabilise as PBOC counters devaluation claims Today’s PBOC press conference supports our view that the fall in the renminbi as a result of the shift to a new reference rate mechanism was a one-off and not an attempt to engineer a large scale... 13th August 2015 · 1 min read
US Economics Update Will events in China force the Fed to delay US rate lift-off? The risk of a further market-driven slide in the Chinese renminbi and the renewed slump in global commodity prices, triggered by heightened concerns about the state of China’s economy, probably won’t... 12th August 2015 · 1 min read
Global Markets Update EM markets to rebound once fears about China ease Financial markets in South Korea, Malaysia and commodity-producing EMs will probably continue to suffer the biggest losses if the renminbi depreciates further against the dollar. But we doubt that the... 12th August 2015 · 1 min read
Africa Data Response Nigeria Consumer Prices (Jul.) Today’s figures show that Nigerian inflation remained at 9.2% y/y in July, but we still expect that inflation will pick up later in the year. FX restrictions and the eventual weakening of the naira... 12th August 2015 · 1 min read
Asia Economics Update Talk of a fresh round of Asian "currency wars" is overblown The second downward revision to the People‘s Bank of China‘s daily reference rate for the renminbi has today intensified talk that a fresh round of “currency wars“ is about to sweep across Asia. We... 12th August 2015 · 1 min read
China Data Response Activity & Spending (Jul.) July’s weaker-than-expected activity and spending data will undoubtedly add to speculation that policymakers are trying to engineer a sustained devaluation of the renminbi in order to shore up growth... 12th August 2015 · 1 min read
India Economics Update No need to panic over rupee sell-off The rupee has depreciated to its weakest level since the 2013 "taper tantrum" this morning, but we don't think that this will cause panic among policymakers. Since the start of the year, the rupee has... 12th August 2015 · 1 min read
China Economics Update China is not declaring a “currency war” A second downward adjustment to the renminbi reference rate today suggests that policymakers are now more willing to give in to market forces than we had previously thought. That said, we still think... 12th August 2015 · 4 mins read
DM Markets Chart Pack How has the lower oil price affected US credit spreads? It is tempting to interpret the recent increase in the average spread of US corporate bonds over Treasuries as a sign that the economic recovery is faltering. However, the increase appears to have... 11th August 2015 · 1 min read
Commodities Update Further fall in Brazilian real could add to sugar’s woes Continued weakness in the Brazilian currency could undermine the price of sugar further. However, we think greater ethanol production and consumption in Brazil will provide some support to the price... 11th August 2015 · 1 min read
Emerging Markets Economics Update Spillovers to EMs from renminbi “devaluation” limited The decision by the People’s Bank of China to reduce the daily reference rate for the renminbi has generated plenty of headlines about spillovers to other EMs. In practice, however, we think that... 11th August 2015 · 1 min read
Global Markets Update Renminbi “devaluation” may not be such a big deal Today’s reduction in the daily reference rate for the renminbi has been widely interpreted as the first of many moves whose main purpose is to regain competiveness by devaluing the Chinese currency... 11th August 2015 · 1 min read
Africa Data Response South Africa Manufacturing Output (Jun.) Today’s manufacturing output figures were slightly above consensus, but still point to a contraction in the economically-crucial sector. Firms have failed to benefit from a weaker rand, another sign... 11th August 2015 · 1 min read
China Economics Update Talk of major policy shift toward RMB devaluation overblown By setting a lower mid-point for the renminbi’s trading band the People’s Bank has sparked speculation that it is embarking on a competitive devaluation of the currency in order to shore up exports... 11th August 2015 · 1 min read
Africa Economics Update Ugandan rate hike adds to African tightening cycle The Bank of Uganda’s decision to hike interest rates by another 150bp today was an effort to support the flagging currency. The hike is yet another example of Sub-Saharan Africa’s escalating... 10th August 2015 · 1 min read
