Thursday, June 29 2017 | ASIA TODAY INTERNATIONAL - Reporting the Business that Matters in Asia
Updated: 4 hours 43 min ago
In March 2017, the balance of outstanding commercial banking loans to the private sector grew at a nominal annual rate of 15.2% (9.3% real), 2.2 percentage points higher than the rate observed in the previous month (12.9%) and the rate recorded In March 2016 (14.4%)
Our China Vulnerability Sentiment Index (CVSI) moderated in April after improving since July 2016. The CVSI is now edging to neutral, however the components of the index show divergence. The moderation can be related to a decline in housing and FX components. The shadow banking component remained positive on a tighter monetary policy stance and macroprudential measures.
We analyse the fiscal policy lessons from the recent recession in the Spanish economy and the options for the future. Our results indicate that budget balance and public debt trends showed clear signs of unsustainability between 2009 and 2011, with few alternatives available other than reducing the fiscal deficit.
In March 2017, US$2,520.3 million was received by Mexico in family remittances. This is the third biggest volume of remittances ever received in a single month, surpassed only by the US$2,637.7 million of October 2008 and the US$2,534.6 of May 2006
Turkish lira appreciated mostly on local factors. Foreseeing a rising trend in inflation, the CBRT’s front-loaded tightening in April held the Turkish lira firm. On the activity side, ongoing fiscal stimulus, strong support through exports and credit growth helped GDP growth continue to be moderate in 1Q as well.
Consumer prices rose by 1.3% in line with the market consensus, but lower than our expectations (1.6%) in April. Thus, annual inflation rose further to 11.9% from 11.3%. The reason behind this month’s increase was almost entirely due to the surge in food prices. We estimate that inflation will fall into single digits in the last two months and end the year at 9%.
We have revised our growth projection for this year by a percentage point to 2.5%. This adjustment reflects the fact that the three local risks we indicated in our February report have finally materialised: the weather problems continued, the delay in the major infrastructure construction projects continued and finally, business confidence dropped even further.
From 8 November when the results of the US presidential election were announced until mid-January, Mexico’s economic panorama looked gloomy. President elect Trump was relentless in his protectionist rhetoric towards Mexico – he would leave NAFTA, impose high duties on imports of Mexican cars and tax remittances to finance the construction of the border wall
Following the triggering of Article 50 of the Treaty of Lisbon in March, the United Kingdom's exit process has formally begun. However, there is still significant uncertainty. It is not clear, for example, whether or not the UK can reach a new trade agreement in the coming years, or if there will be a period of transition.
Weekly economic update focusing on the major economic indicators to be released the week of May 1, 2017. Special topic: 1Q GDP
Perspectives for world growth have increased slightly in the last quarter. In Colombia, 2017 began slowly, with growth affected by the low level of consumer confidence and sluggish public and private investment. Inflation continues to decline and BanRep will slash its benchmark rate in the coming months.
The world economy is transitioning to a carbon-free paradigm triggered by the potentially disastrous effects of climate change. In the following years, vast amounts of capital will be allocated to mitigation and adaptation projects. With the right strategy, the opportunities for the banking industry could outweigh the risks
Per the March meeting minutes, FOMC members have discussed a phased-out approach to ceasing the balance sheet reinvestment policy – to reduce “the risks of triggering financial market volatility” and avoiding a rebirth of the taper," to remain committed to acting “passive and predictable,” and to communicate “to the public well in advance of an actual change”
Growth in Latin America will recover to 1.1% in 2017 and 1.8% in 2018. This will bring an end to four years of slowdown and a return to growth, following the contraction of 1.4% in 2016, although growth will still be slow. The recovery in Argentina is firming up, while Brazil seems to be coming out of its period of adjustment
There was neither a discussion on the exit strategy nor clear hints of an early shift in the policy stance but risks to growth are more balanced (though still downwards). We expect some changes in forward guidance in June