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COUNTRY INSIGHTS

Federal budget deficit could exceed the amended target amid disinflation and excessively strong ruble
RUSSIA ECONOMICS · In Brief · 08 Jul 2025

The recent thinking of the Russian government suggests the 2025 federal budget deficit of R3.8 trln, which is wider than the initial target of R1.2 trln. The reason behind this change is shrinking oil-and-gas (O&G) revenues as the ruble remains too strong (at about USD/RUB 79) for some time, with...

Headline inflation up temporarily on fuel prices, core inflation markedly down in June
HUNGARY · In Brief · 08 Jul 2025

The headline rate of CPI-inflation in June has been reported this morning at 0.1% mom, 4.6% yoy, the latter up from 4.4% yoy in May. This uptick was entirely due to fuel prices, which rose by 0.5% mom. Here the point is that fuel prices actually fell by 3.4% mom in June 2024, and the difference b...

The rate decision – July 7, 2025: no cut, hawkish tone, but 50bp expected no later than Q4 2025
ISRAEL · In Brief · 07 Jul 2025 · 1 response

The central bank of Israel kept its benchmark interest rate unchanged at 4.5% on July 7th, for the twelfth consecutive meeting. The decision was largely in line with expectations, even though a growing number of economists and market participants had anticipated a signal toward monetary easing.De...

Rising tide
BRAZIL ECONOMICS · Report · 07 Jul 2025

The appreciation of the Brazilian real in 2025 has been accompanied by a similar movement in several other currencies, consistent with the global weakening of the U.S. dollar. When analyzing the real’s behavior against the basket of currencies that make up the Dollar Index, we observe only a mode...

Tarcísio gains strength for 2026 and other weekly topics
BRAZIL POLITICS · Report · 07 Jul 2025

Negotiations continue between representatives of the three branches of government on the IOF issue. Deputy Arthur Lira, rapporteur of the bill on Income Tax, will present his report. The Joint Budget Committee may vote on its preliminary report on the Budget Guidelines Bill (PLDO). This week's...

Short-term boost, long-term bets: Panama Canal projects and the economic outlook
PANAMA · Report · 07 Jul 2025

Panama’s economy posted strong 5.2% GDP growth in Q1 2025, driven primarily by the recovery of the Panama Canal and the expansion of Copa Airlines. The transportation sector alone contributed 56% of total growth, reflecting a rebound in toll revenues (+42.4% YoY) following the 2024 drought and th...

Economics: Activity figures published in June point to stagnation for the rest of 2025
MEXICO · Report · 07 Jul 2025

Following May’s report showing that Q1 GDP edged up only around half a point in the first quarter, this past month’s aggregate supply and demand results filled out the picture as it showed a 25% drop in public investment, private investment turning sharply negative and consumption weakening consi...

Politics: Recently approved bills raise the specter of weakened civil liberties
MEXICO · Report · 07 Jul 2025

The priority of President Claudia Sheinbaum’s administration has been to consolidate her predecessor Andrés Manuel López Obrador’s "Plan C", of obtaining and using an automatic two-thirds majority in congress to be able to pass legislation as well as amend the constitution in order to permanently...

The fiscal deficit is within the corridor
INDONESIA · Report · 07 Jul 2025

Indonesian Minister of Finance Sri Mulyani Indrawati reported to the Indonesian parliament on the country's fiscal performance, as well as the fiscal outlook for the year 2025. In the midst of skepticism about Indonesia's fiscal policy under the new president, Prabowo Subianto, she reported that ...

Lira will submit his report on the income tax bill, the Senate may vote on the bill that legalizes gambling, casinos and bingo tomorrow, and the PT may announce its new president today
BRAZIL POLITICS · Report · 07 Jul 2025

Deputy Arthur Lira (PP-AL), rapporteur for the bill that exempts income tax for those earning up to R$5,000 per month, will submit his report to the Special Committee discussing the matter. After Lira presents his report, a request for a review is expected. Voting in the Lower House plenary is sc...

The hand that rocks the cradle
BRAZIL ECONOMICS · Report · 07 Jul 2025

The release of Q1 GDP revealed certain imbalances in the economy. On the supply side, GDP was driven by the strong performance of the agricultural sector, which grew over 12% in seasonally adjusted terms and 10% compared to the same quarter in 2024. Meanwhile, industrial GDP shrank slightly by 0....

India's exports in a turbulent world economy
INDIA · Report · 07 Jul 2025

In memoriam: This is the final report prepared by Radhika Pandey. The global trade system is in a state of flux. There are early indicators that India is one of the few countries that stands to gain from the turmoil. In addition to the long-standing strength of services exports, there is now t...

Strained but standing: South Africa’s fiscal challenges and reform opportunities
SOUTH AFRICA · Report · 07 Jul 2025

The OECD, in June, released its Economic Survey of South Africa, and it provides a sobering view of the country’s fiscal landscape. With gross government debt expected to remain above 75% of GDP in the near term (higher than the typical G20 emerging market economy), and significant revenue short...

Bank of Israel likely to hold rates steady, but easing expected in upcoming meetings, possibly as early as August
ISRAEL · In Brief · 07 Jul 2025

The Bank of Israel is expected to announce its key policy rate decision today (Monday, July 7). While we do not expect a rate cut at this meeting, there is a growing consensus that easing could begin as early as August. The sharp appreciation of the shekel (up ~9% since mid-April), a notable decl...

Disinflation amidst political turmoil
TURKEY · Report · 06 Jul 2025

The final battle between Erdogan and CHP began Saturday, when three more CHP mayors were detained. Erdogan holds all the cards against a defiant Ozgur Ozel in this winner-takes-all wrestling match, which will soon witness Ankara mayor Mansur Yavas and Ozel himself being eliminated from politics, ...

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