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COVID-19, Rating Downgrade Push South Africa’s Economy Off the Edge

South Africa’s ailing economy has long teetered on the edge of a recession, with only a light breeze needed to send it off the cliff. Is the coronavirus pandemic, which has intersected with the Moody’s downgrade of the sovereign to junk, a death knell for the continent’s second largest economy?

15 Apr 2020

Pandemic to Squeeze Margins at GCC Banks – S&P

The COVID-19 pandemic combined with the subsequent slump in oil prices is a particularly dangerous combination for GCC economies given the region’s exposure to commodity prices. According to a report from S&P, the region’s banks face an earnings shock, with a notable slowdown in credit growth and higher risk premiums – although other key metrics remain strong.

14 Apr 2020

Inflation Slows in Hungary, But Full Impact of COVID-19 Not Yet Evident – ING

As the lockdown continues in Hungary, the impact on the economy is beginning to filter into the data, with inflation slowing to 3.9% in March. Whilst food prices provide upward pressure in the short-term, the falling cost of fuel and services has yet to be accounted for in this month’s statistics, according to Peter Virovacz, Senior Hungary Economist at ING

9 Apr 2020

Qatar Reopens GCC Capital Markets with USD10bn Trade as Other Sovereigns Consider Raising Funding

Qatar has returned to the capital markets with the sale of a USD10bn Eurobond, marking the latest issuance from EM sovereigns returning to the markets.

8 Apr 2020

Kenyan Banking Sector Recovery Cut Short as Pandemic Crosses into the Country

Encouraging full-year 2019 results published by Kenyan lenders pointed to a build up of momentum, but the spread of COVID-19 is forcing the government to introduce emergency measures and banks to slash revenue targets for 2020.

7 Apr 2020

Multi-Notch Sovereign Downgrades Likely Across Emerging Markets – Fitch

The onset of the coronavirus and a slump in the oil price is leading to a rise in the likelihood of multi-notch sovereign downgrades.

7 Apr 2020

Central Bank of Brazil Prohibits Dividends, Pay Rises for Banks

The National Monetary Council (CMN) of the Central Bank of Brazil has temporarily prohibited pay rises for financial institutions in the country until September 2020. The ban is aimed at ensuring that funds are used to maintain credit and to absorb any future losses that may occur.

6 Apr 2020

Akbank Renews USD510mn Syndicated Loan Despite Market Volatility

Akbank has successfully renewed a USD510mn syndicated loan, marking a rare transaction amidst a volatile market backdrop. With a one-year maturity, the loan priced at LIBOR+2.25%, lower than the previous cost of borrowing on the facility in March last year.

3 Apr 2020

Emerging Markets Already Presenting Opportunities Despite Fear of Second Wave of Outflows

The asset class continues to see significant outflows as a flight to safety escalates, with the vast monetary and fiscal stimulus programmes announced by global governments in recent weeks failing to convince markets of brighter near-term prospects. But investment opportunities may become more pronounced sooner than people think, investors say.

3 Apr 2020

Relationship Between Stocks & Bonds is Not Broken – MSCI

As the severity of the economic disruption wrought by the COVID-19 pandemic ensued, both bonds and stocks alike took a beating, raising questions about the historic inverse relationship between the two asset classes.

2 Apr 2020

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