Sunday, February 18 2018 | ASIA TODAY INTERNATIONAL - Reporting the Business that Matters in Asia
Updated: 11 hours 45 min ago
The GDP growth rate of 3Q17 surprised on the upside at 11.1% (8.5% both BBVA-GB and consensus), which was supported by the Government’s counter-cyclical measures, favorable base year impact and working day adjustments. This strong figure and an already promising 4Q17 nowcast will lead us to significantly upgrade our already high GDP forecast (6%) to near 7% for 2017.
The economy of Navarre grew by 2.9% in 2016. It will grow by 3.0% in 2017 and by 2.8% in 2018. This will add some 8,000 new jobs between 3Q17 and the end of 2018; unemployment shall drop to 8.8% by then. Although pre-crisis GDP per capita will be recovered this year, creating more and better jobs remains a challenge.
Nobody will have failed to notice that Europe’s economy is responding better than many had thought a little over a year ago, when there was not much faith in the sustainability of growth. Moreover, the outcome of the Brexit referendum and the problematical election schedule had increased the risks looking ahead into 2017.
Weekly economic update focusing on the major economic indicators to be released the week of December 11, 2017. Special topic: November employment report
Monetary Policy should not react to temporary supply shocks. In a close call (70-30 odds) we expect Banxico to hold rates steady at next week’s policy meeting. A hawkish pause is enough for the time being
Highlights: GHOS announce agreement on outstanding elements of Basel III. BCBS publishes cumulative quantitative impact study on reviewed Basel III and discussion paper on regulatory treatment of sovereign exposures. ESAs publish list of identified financial conglomerates and SRB publishes its 2018 work plan. Bank of Spain approves new accounting rule for credit entities.
The stock market is not significantly overpriced after controlling the effect of imminent corporate tax cuts. No visible credit bubble for domestic debt. The deleveraging of households and financial institutions is effective
The economy contracted in the third quarter of the year. The preliminary QoQ growth rate, annualised, was negative at 0.8%
Remittances in October 2017 mark a new all-time high, surpassing the previous record of $2,637.7 million established in October 2008. The depreciation of the peso against the dollar of more than 5% in October compared to September, due to the uncertainty generated by the NAFTA renegotiations, might explain this growth in remittances.
Global risk aversion stabilizes at historically low levels. Despite recent geopolitical tensions, all indicators remain virtually unchanged. Continued decline in sovereign CDS over the past year has led many countries to reach new historical lows
ISIS continues losing territorial control in 2017, while US is increasing its military presence in the region. However, the risk regarding foreign fighters returning their home countries could continue. Saudi Arabia’s political noise and Riyadh-Tehran rift created uncertainties during the month. North Korea’s recent missile test increased tensions.
We present the results of an empirical exercise in which we seek to explain the deleveraging process that follows the burst of a credit bubble following a systemic banking crisis. We have built up two new databases and have estimated a SUR regression model to jointly explain and predict how strong and how fast private leverage falls after the burst of a credit-bubble.
We apply the natural language processing or computational linguistics (NLP) to the analysis of the communication policy (i.e statements and minutes) of the Central Bank of Turkey (CBRT). While previous literature has focused on Developed countries, we extend the NLP analysis to the Central Banks of the Emerging Markets using the Dynamic Topic Modelling approach.
The most recent inflation figure, corresponding to the first half of November, surprised on the upside. After falling in September and October, headline inflation showed an upturn from 6.4% to 6.6%. This increases the likelihood that the Banco de México will increase its monetary policy rate as a preventive measure
Annual consumer inflation hit 13% mostly due to the sizable pick-up in food inflation and also the jump in both energy and core prices in November. Recent events and rigidity in core prices signal that the range of the CBRT’s expected medium term disinflation path may not to be materialized, thus, monetary policy should be adjusted accordingly.
Inequality in Spanish household income has increased during the crisis. However, in terms of consumption, inequality decreased. Accordingly, while wealthier families reduced spending by 17.2% between 2007 and 2015, those economically disadvantaged reduced it only by 7.6%.