Articles List

Fuels Demand Set For 2018 Recovery

High frequency indicators signal that fuels demand in the GCC has begun to normalise. Firming economic activity will support stronger consumption in 2018, but continued energy sector reforms will anchor growth substantially below the pre-oil price crash norms.

Bungled Resignation Sustains Uncertainty

Despite ongoing uncertainty over exactly how he will go, President Mugabe lacks the political support either at home or abroad needed to avoid his removal from office. The most likely outcome involves parliamentary impeachment and his replacement by former Vice-President Emmerson Mnangagwa.

Four Scenarios For Coalition Deadlock

The withdrawal of the FDP from Germany's 'Jamaica coalition' negotiations will usher in a period of political uncertainty. The most likely outcomes include a minority government or the calling of fresh elections, although the latter would be unlikely to produce a different result and could even boost the prospects of the far-right AfD.

Competition Index Highlights Open, Competitive Markets

Frontier markets are large recipients of foreign financing and aid, which has resulted in the strong presence of foreign contractors in their construction industries. Developed markets often have strong transparency and antitrust regulations that promote competition, but remain difficult for foreign companies to access owing to strong incumbents and protectionist measures.

Election Risks Unlikely To Weigh On Positive Growth Outlook

Malaysia's real GDP expanded by 6.2% y-o-y in Q317 versus the 5.8% y-o-y recorded in Q217. The government's leading indicators suggest that economic momentum remains strong, and we expect the business environment to remain positive amid ongoing efforts by the government to improve the bureaucracy. A strong public infrastructure investment drive will lend additional support. We have upgraded our real GDP forecast for 2017 and 2018 to 5.9% and 5.5% respectively, from 5.3% and 5.0% previously.

Growth To Slow, But Investment To Pick Up

Real GDP growth in the Czech Republic will moderate in the coming quarters in line with tighter monetary policy and slowing gains in the labour market as the economy reaches full employment. Investment activity will pick up, however, supporting an upswing in productivity growth.

Meaningful Reforms Unlikely To Follow Personnel Change

Despite President João Lourenço's sweeping personnel changes in the upper echelons of Angola's government, we remain sceptical that the moves herald any meaningful progress towards a reform agenda. The measures instead represent Lourenço's attempt to consolidate power and emerge from the shadow his long-serving predecessor.

Divergent Trends In EM Private Debt; Turkey A Key Risk

Trends in private debt vary across the emerging markets (EMs), with some countries deleveraging while others continue to accumulate debt. In general, debt levels are relatively benign by historical standards, although there are certainly some risk hotspots, most notably Turkey, as outlined below.

Limited Room For Further Easing

Bank Indonesia held its policy rate at 4.25% at its November meeting as it attempts to support growth and maintain currency stability. We are of the view that interest rates are currently too low and pose a risk to macroeconomic stability. The continuation of the US Fed's rate hiking cycle and an expected reversal in the inflation downtrend are likely to limit room for further policy loosening.

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