Macro
Q4 Emerging Markets Outlook: Are Markets at an Inflection Point?
Emerging Markets have been buffeted by a variety of negative factors this year, but have remained resilient. The overriding factor is that the global liquidity backdrop remains supportive of “risk.” We expect this favourable outlook to continue (more or less) into year-end. It appears, however, that the markets are at an inflection point, which may be enough to put some downward pressure on risk…
18 Oct 2016
Saudi $2bn deposit edges Egypt closer to IMF loan
Cairo is closing in on a relief loan that could provide the vital lifeline to Egypt’s stagnant economy, but the strict terms of the deal mean that the road to recovery will be painful.
17 Oct 2016
Sukuk in MENA: Two tranche or not to tranche?
This year has so far seen a rapid expansion in bonds and to a lesser extent sukuk issued from the GCC, largely led by many of the region’s sovereigns and financial institutions. Speed, standards, and liquidity concerns are keeping some issuers from tapping into the sukuk market to achieve their funding objectives, analysts suggest.
17 Oct 2016
LatAm leads sovereign issuance across EM
A large number of corporate debt maturities across EM over the next two years combined with a commodity downturn pressuring government finances have led to large amounts of borrowing across the asset class for 2016, with Latin American sovereign issuance standing out among its EM peers.
14 Oct 2016
DFIs: Fearless lenders adopt new techniques to keep risk appetite alive
The development finance space in Africa has evolved quite a bit in recent years, prompting DFIs to change tack in order to address the evolving funding needs in the region’s economies. Will the challenges and pressures that come with being a modern DFI impede their fearless and risk-hungry nature? The development of many African markets may depend on whether they do.
13 Oct 2016
After depleting funds, Russia to focus on local and Asian borrowing
Russia’s reserve fund will be depleted early next year, and although there are plans to tap the welfare fund, it is unlikely to be a suitable alternative. Foreign financing will still play a role in the government’s future funding plans, but with much more focus on Asia and particularly China, and the government also plans substantial local issuances which will likely be very well received due to…
13 Oct 2016
Turkish market resilient as inflation threat looms
Investment flows in Turkey’s local currency credit market defied expectations this year, powering through two ratings downgrades, an attempted coup and a drop in tourism revenues. Slowing consumption and the threat of inflation are forcing policymakers to remain vigilant.
12 Oct 2016
Impact of dollar shortage varies across Nigerian banks
Nigeria’s banking sector is facing significant pressures from a lack of dollar liquidity. Further devaluation in the naira would exacerbate NPL levels – which the country’s newest project, the Development Bank of Nigeria – would do little to alleviate. However, whilst some lenders are completely locked out of the international markets, others are in relatively good shape and are still able to…
12 Oct 2016
Brazil to turn government bonds into stock as ETFs go global
Political scandals are quieting down and commodity prices are rising steadily in the last few months, and Brazil’s economy appears to be gaining traction. However, as real growth is still hard to come by, could bond exchange-traded funds provide the boost that the economy urgently needs?
11 Oct 2016
Oman’s local banking sector remains resilient
Omani companies are making their presence known in the international loan markets. Although larger entities prefer international funding because it is cheaper due to the relatively small size of the local markets, the domestic banking sector remains strong, although heavy domestic government borrowing, designed to cover its deficit, could see pressures increase.
11 Oct 2016