Currencies
The Cape Town Shuffle: Rand Plummets as Zuma Sacks Chief Treasurer
The sacking of South Africa’s finance minister and his cabinet prompted another all-too-familiar slide in the rand and bond prices. As his successor takes office, the markets are tentatively awaiting signs about the direction of economic policy.
5 Apr 2017
Nigeria: A Struggling Economy Embraces Reform - Part I
Over the past year Nigeria's economy, hit by rising inflation, low FX reserves and deflated oil price, shrank by about 1.6%. But with a better market outlook on the horizon, as evident from the recent success of a US$1bn Eurobond, the Bonds & Loans Nigeria Special Report looks into what 2017 may bring.
4 Apr 2017
VIDEO: Interview with Michael Dunning, Head of Corporate Ratings, EMEA, Fitch Ratings
Bonds & Loans spoke with Michael Dunning, Regional Head of Analytics Group in EMEA Region for Fitch, about the success of Russia's macro outlook for 2017, the success of the banking sector clean-up and the prospects of the rouble.
22 Mar 2017
Interest Rates in Brazil: If Only It Were That Easy
The concern over high interest rates in Brazil is understandable. It impacts the public coffers in favour of the richest and discourages productive investment. Many analysts argue that the interest rate is too high, and that the main reason for its inaction is pressure from special interest groups, notably the financial market. Although this argument is seductive for its simplicity, it does not…
21 Mar 2017
With Russia’s CB Moving to China, Sovereign Yuan Eurobond Moves One Leap Closer
Russia spent much of last year bolstering its ties to the Chinese economy in the hopes of tapping into Asian liquidity through the capital markets, most recently revealing plans to set up a Russian Central Bank outpost in Beijing. The move is a fairly sizable leap towards Russia’s first sovereign yuan-denominated issuance, and a signal that it is still keen to hedge against bets that its…
17 Mar 2017
Time for Caution on Inflation in Brazil
Inflation targets are widely used by Central Banks throughout the world. In countries with moderate inflation, this regime helps keep inflation well behaved, with less cost to economic activity. In countries with low inflation, the risk of deflation can be mitigated by setting a suitable target. This targeting also makes monetary policy more predictable, contributing to a stable economic…
16 Mar 2017
CBK Governor on the Trump Effect, Banking Sector Risks, and the Promise of Green Finance
Having weathered most of 2016 quite well, Kenya faces a number of domestic and external headwinds including a prolonged drought and increasing uncertainty around the future policy direction in the US, UK and Europe. But Patrick Njoroge, Governor of the Central Bank of Kenya believes some of these challenges also present opportunities – to explore further East African policy integration, double…
13 Mar 2017
Will Mexico’s Currency Gambit Pay Off?
Few currencies have suffered more since the surprise election of Donald Trump last year than the Mexican peso. Trump made Mexico a cornerstone of his electoral campaign and attacked the Central American country on a number of issues ranging from illegal immigration to the renegotiation of the North American Trade Agreement (NAFTA), which put increasing pressure on the country’s currency and drove…
13 Mar 2017
Clearing a Path for Local Currency Markets in Latin America
Many Latin American countries are looking to bolster their capital markets and make them more accessible to foreign investors lured to the region in search for higher returns, with clearing and settlement platforms playing a starring role.
10 Mar 2017
Are Rate Hikes Enough to Stabilise the Lira?
Turkey’s Central Bank pressed on with a 50bp interest rate hike in November despite persistent criticism from President Recep Tayyip Erdogan, and held its benchmark one-week repo rate at 8% at the latest meeting in January – despite market expectations. Analysts believe the move won’t be enough to stem the currency’s decline, with further rate hikes expected – which could provoke further…
28 Feb 2017