As Gabon is the fifth largest oil producer in sub-Saharan Africa, the health of its economy is tied to its hydrocarbons industry. But since the 2014 oil crash, the legislation currently governing the sector has been wholly unsuitable. Now, the government is hoping to woo international oil companies (IOCs) by revising the code; but the President’s recent illness, along with a failed coup attempt…
7 Jan 2019
It has been a difficult year for Argentina. With inflation climbing above 40%, the ARS losing over half of its value against the US dollar, and lingering fears remaining following the Notebook scandal, investor confidence has been heavily dampened. But a reform-minded government, coupled with multilateral support, has created a sense that Argentina’s numerous structural deficiencies are beginning…
14 Nov 2018
EM FX has come under renewed pressure as the dollar staged a broad-based recovery after the FOMC meeting. Data this week is likely to show continued robustness in the US economy, cementing a December hike by the Fed. Elsewhere, concerns about China, Italy, and Brexit are likely to weigh on market sentiment. We remain negative on EM.
12 Nov 2018
EM FX got some traction last week as the dollar rally stalled. Still, event risk remains high in many EM countries, notably Brazil, Mexico, South Africa, and Turkey. The FOMC meeting this week is widely expected to see no actions, but the Fed should signal that a December hike is on track. As it is, US yields are marching higher again. We believe the global backdrop for EM remains negative.
5 Nov 2018
EM FX ended last week on a firm note but the week was still a bad one. We think risk-off impulses will continue and likely intensify in the coming weeks. As such, we remain negative on EM as an asset class. China will provide its first glimpse of October with PMI readings, while US jobs report Friday will be the data highlight of the week.
29 Oct 2018
Environmental, social and governance (ESG) indicators are integral to PIMCO’s sovereign credit assessments, which inform our investment decisions. But how exactly do we incorporate ESG considerations into our decisions?
17 Oct 2018
In this exclusive Bonds & Loans webinar we chat to Brad Tank, CIO of Neuberger Berman, on the aftermath of the biggest financial crisis the world faced in the past 30 years - and where the global markets are ten years on.
10 Oct 2018
We saw a significant EM positioning washout last week, with weak longs getting punished. Anyone lulled into jumping aboard the EM train recently is getting crushed by sharply higher US rates. ARS and BRL bucked the trend and gained last week, but all others were weaker and were led by ZAR, CLP, and COP. MSCI fell 4.5%, while EM bond yields surged. With US rates still marching higher, EM is likely…
8 Oct 2018
With the October mini budget speech looming, South Africa’s economy and funding environment come sharply into focus; both remain in a precarious state. Analysts, investors, CFOs and Treasurers who spoke with Bonds & Loans on a recent research trip to the region emphasise that the way in which the macro environment evolves, and the way in which the government tackles key issues like land reform,…
28 Sep 2018