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Further rate cuts are expected in Mexico after growth forecasts are revised down again, while the benchmark rate is now forecast to be just 4.75% by end of the year.
23 Apr 2020
The twin shock of coronavirus and plummeting oil prices have put the brakes on global growth. Combined with widespread outflows, a strengthening US dollar and a global recession, emerging markets face an unprecedented flurry of headwinds. According to a recent report from Fitch, weaker rated GCC sovereigns may be vulnerable to a downgrade in the current market conditions.
23 Apr 2020
This week the IMF announced plans to provide USD500mn in debt relief to some of the world’s poorest countries under its Catastrophe Containment and Relief Trust. All countries eligible for concessional financing from the World Bank are targeted by the G7’s debt service payments.
20 Apr 2020
EM is coming off a difficult week in which all the economic data underscored just how bad the global outlook has gotten. While risk sentiment ended last week on an upbeat note, we believe EM and other risk assets will have difficulty getting much traction as the data continue to worsen. Oil prices remain under pressure and that is likely to weight on sentiment as well.
20 Apr 2020
Ecuador, like many EM countries, has been shaken by a toxic cocktail of coronavirus, crashing oil prices and restricted access to financial markets. But according to Jan Dehn, Head of Research at Ashmore, Ecuador’s approach to dealing with the crisis – defined by pro-active engagement with creditors – is one others in the market should learn from.
17 Apr 2020
Kenya has so far managed to limit the spread of COVID-19, with just 184 cases and 7 deaths reported as of 10 April 2020, and the government has responded with fiscal and monetary measures to buoy the economy. According to Cytonn Investments, the government’s actions need to go further but the government remains constrained by its fiscal deficit.
16 Apr 2020
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
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
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