Download PDF: Last November we discussed the cyclically bullish but bleaker longer-term outlook for South African assets, in which the former has played out nicely until the end of second quarter this year. Our long position on South African bond was closed on August 10 with 10.2% gain while our overweight recommendation on South AfricanContinue reading “South Africa: The Not So Good, The Bad, and The Ugly”
Tag Archives: fiscal
Brazil: Fiscal Crisis in the Making?
Download PDF: The Brazilian 10-year bond yield has continued to shoot up to 11% this month amid the political debacle in the country and lack of credible proposal from the government to reign its growing public debt. A hawkish Fed, deterioration in Chinese growth and flareup of the pandemic globally all point to downside riskContinue reading “Brazil: Fiscal Crisis in the Making?”
Peru: Latin America’s Growth Star
Download PDF: For long investors have regarded Chile and Peru as one of the more stable Latam countries, as reflected in these countries’ borrowing cost and disciplined management of fiscal and monetary policy. Late last year, however, Peru went through a political crisis over the impeachment of former President Vizcarra by the Congress over corruptionContinue reading “Peru: Latin America’s Growth Star”
South Africa: The Good, The Bad, And The Ugly
Download PDF: South African government released its medium-term budget plan late last October, highlighting the steps it will take to bring the country’s spiraling public debt under control. South African assets had been bombed out this year, which offers attractive investment opportunities from a tactical point of view. However, structural outlook remains bleak and theContinue reading “South Africa: The Good, The Bad, And The Ugly”
South Africa: Is The Worst Yet To Come?
Download PDF: South African government fiscal situation turned from bad to worse this year amid a shortfall in tax revenue and increase in spending to support growth (Chart 1). The government’s revision to its budget in June mainly reflects a shifting of its spending, i.e. delaying projects to 2021/2022 or beyond while prioritizing funds forContinue reading “South Africa: Is The Worst Yet To Come?”
A Tale of Two Latam Countries: Brazil and Mexico
Download PDF: Brazilian manufacturing sector’s recovery has been surprisingly strong post-pandemic, outpacing other EM countries, despite the still poor health care situation and strict lockdown restriction nationally. However, the strong rebound has not been followed proportionately by the country’s asset prices, contrary to the development seen in Mexico (Chart 1). The country still records contractingContinue reading “A Tale of Two Latam Countries: Brazil and Mexico”
Taking A Pulse on EM Recovery
Download PDF: The current economic situation in majority of EM countries is still very bleak amid various lockdown measures, but the worst has likely passed as economic activity continue to recover in most countries (Chart 1). There are signs that even in the worst-hit EM countries, measured by number of deaths per hundred thousand population,Continue reading “Taking A Pulse on EM Recovery”
Assessing EM Countries’ Vulnerabilities and MMT in EM Universe
Download PDF: EM equity has experienced indiscriminate sell-off during the peak of this year’s market rout, with losses ranging from 20% to 60% across 18 countries. Since its March’s low, however, few countries have staged a strong asset prices recovery, whereas others are still lagging and have barely recover half of their losses (Chart 1).Continue reading “Assessing EM Countries’ Vulnerabilities and MMT in EM Universe”
A Tale of Two Countries: Indonesia and Philippines
Download PDF: As a rising growth star in the Emerging Market universe and South East Asia region, both Indonesia and Philippines share many similarities. First, both countries run fiscal and current account deficit. Second, both have a government that are currently focusing on building the country’s capital through multi-year infrastructure projects. Third, they have aContinue reading “A Tale of Two Countries: Indonesia and Philippines”
Indonesia: An In-Depth Analysis
Download PDF: Preparing the Groundwork for A Takeoff Indonesia’s macro profile has significantly improved in the past decade despite still running fiscal and current account deficit. First, government spending has been reoriented toward building human and capital stock, supported by the country’s high savings rate, while public debt level remained among the lowest across EMContinue reading “Indonesia: An In-Depth Analysis”
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