Tuesday, September 19 2017 | ASIA TODAY INTERNATIONAL - Reporting the Business that Matters in Asia
Updated: 11 hours 35 min ago
The Central Bank kept its interest rate corridor unchanged. Bearing in mind the stickiness in inflation and the ongoing high momentum of the economic activity, we expect the Bank not to find enough room for monetary easing until the end of the year when the headline will fall towards 9% thanks to favorable base effects on food and tax hikes of last year.
The Colombian economy responded positively to the oil Price shock maintaining positive growth. Nonetheless the recovery will be slow given the limited sources of growth. Inflation should continue its descending path in 2018 reaching the target range and there will be space for the Central Bank to continue reducing its reference interest rate.
Risks detected in our previous report have materialised, and we have therefore revised our projection for this year down to 1.3%, but we maintain an increase by 2.4% in 2018. Increasing slack in the economy and the strength of the peso lead us to estimate an end-of-period inflation by 2.6% YoY, with a downward bias, and 2.8% YoY for 2018.
The Turkish economy’s “V” shaped recovery is well alive and the pace of the recovery gained momentum with the recent 5% GDP growth in 1Q, thanks to the acceleration in net exports, public spending as well as solid private consumption.
4G projects have demanded an overall significant effort. At the moment, 23 of the 32 4G projects have an ANI’s contractual financial closure and only 8 of them have a definitive one. Our scenario includes an execution which is slower than what the Government expects but that is still supporting GDP growth, especially in 2019. Challenges remain to be overcome.
The slowdown in construction has continued with growth of 1.8%, closing 2016 with an increase of 4.2% in building and a decline of 9.4% in civil engineering
Standard and Poor’s revised Mexico’s sovereign credit outlook up to “stable”, from “negative”, reaffirming its rating at BBB+, two notches above the BBB- minimum required to count as investment grade
Growth in Latin America will increase to 0.8% in 2017 and 1.7% in 2018. The recovery after the -1.2% contraction in 2016 will be helped by the coming out of the recession by two of the main regional economies (Brazil and Argentina), as in most other countries there will be a growth slowdown in 2017 compared to 2016, hobbled by external shocks and weak domestic demand.
Monetary policy symposiums are going to become a summer classic. The Jackson Hole Congress, organised by the United States Federal Reserve for the end of August, is a major benchmark. This is not just true for the academic world because of the topics for discussion, but also for the markets, which are eager for clues about the central banks’ next moves.
Tourism in the Balearic and Canary Islands, investment in Andalusia and Murcia and exports in CC. AA. as Asturias, together with consumption that slows down less than expected, justify the upward revision of Spain's GDP to 3.3% in 2017. Balears, Canarias, Madrid, Murcia and Andalusia continue to lead growth
Weekly economic update focusing on the major economic indicators to be released the week of July 24, 2017. Special topic: housing starts
July meeting opportunity for Fed to keep markets aligned with a gradual tightening path
Highlights: CPMI and IOSCO published update on the implementation of the Principles for Financial Market Infrastructures. ESMA issued a consultation on suitability requirements following MiFID II. EBA issued final RTS and ITS on information requirements for the authorization of credit institutions. EC issued a consultation on its sustainable finance interim report.
The deficit adjustment continues in April 2017, led by Central government. In this scenario, the stability objectives are achievable thanks to the economic recovery. Given the persistence of imbalances, such as high public debt levels, there is still much work to be done for the control of the public accounts.
We project low growth this year with a rebound in 2018, driven by reconstruction and infrastructure spending.
The Argentine economy entered its third consecutive quarter of recovery. Growth forecasts of 2.8% for 2017 and 3% for 2018. Gradually decreasing trend in core inflation will be maintained in the coming months. Inflation as measured by INDEC's GBA CPI will reach 19.5% y/y at the end of 2017, still above the BCRA’s target of 12-17% YoY