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Turkey: The CBRT tightens but lower than expected

December 15, 2017
The CBRT hiked the recent de-facto policy rate (late liquidity window, LLW) by only 50bps to 12.75%, disappointing the market call between 75-100bps and our call of 125bps in the average funding rate. The incoming inflation data will be the key input to know whether the CBRT opted today for a gradualist approach or just a wait-and-see attitude.

International experiences of De-dollarization: What could be done in the Turkish case?

December 14, 2017
Financial dollarization exposes countries to shocks which can trigger severe financial and economic problems. This note describes a few successful country experiences of de-dollarization. A key lesson is that macroeconomic stability and particularly price stability and low inflation is a pre-condition for starting a successful de-dollarization process.

China | Growth moderation continues

December 14, 2017
November economic indicators reported today were generally below the previous readings. Meanwhile, the credit figures kept at a relatively high level as the authorities want to maintain market liquidity toward end-year. As anticipated, the economy continued its moderation in Q4 due to the authorities’ policy initiatives.

FOMC Meeting December 12th-13th

December 14, 2017
FOMC: Passing the Baton for Final Phase of Normalization

Digital Economy Outlook

December 13, 2017
In this issue we will focus on: Digital markets: challenges for competition policy; Initial Coin Offerings (ICOs) ): investment in crypto tokens: fad, madness or vision?; Towards a new digital identity: identification systems and digital environment; Fintech: implications for regulation and supervision; and Artificial Intelligence: a Policy Approach.

Mexico | Credit to the private sector:slight recovery driven by the portfolio of companies

December 12, 2017
In October 2017, the balance of the current credit granted by commercial banks to the private sector grew at a nominal annual rate of 12.5% (5.8% real), 0.3 percentage points higher than the rate observed the previous month (12.3%) but 2.9 percentage points below that registered in October 2016 (15.4%)

Turkey: Domestic demand boosts GDP

December 11, 2017
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.

Navarre Economic Outlook 2017

December 11, 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.

Europe is picking up on several fronts

December 11, 2017
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.

U.S. | Weekly podcast: Employment, inflation and retail sales

December 9, 2017
Weekly economic update focusing on the major economic indicators to be released the week of December 11, 2017. Special topic: November employment report

Mexico |A "hawkish hold" with risks ahead in an unusual context, the best strategy for now

December 9, 2017
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

Financial Regulation: Weekly Update. 8 December 2017

December 8, 2017
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.

U.S. | Are Equity Prices Overvalued?

December 8, 2017
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

Mexico Economic Outlook. Fourth quarter 2017

December 8, 2017
The economy contracted in the third quarter of the year. The preliminary QoQ growth rate, annualised, was negative at 0.8%

Mexico | Remittances reach historic high of US$2,642.7 million

December 6, 2017
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.