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PM of Russia reappointed
RUSSIA / FSU POLITICS · In Brief · 10 May 2024

On May 10, as we predicted, Mikhail Mishustin was given his job back by Putin. The State Duma voted for him with an overwhelming majority in favor, none against but there were some abstentions. Mishustin had to stand down as President Putin began his 5th term. Putin prizes loyalty above all else....

GULF WEEKLY: Saudi Q1 deficit, UAE trade talks with New Zealand, Israel assaults Rafah and bans Al Jazeera
GULF COUNTRIES · Report · 10 May 2024

A skimmable summary overlaid with our analysis and links. Headlines: * OPEC+ for the first time published a compensation plan for countries exceeding their quotas. * Israel began its Rafah assault, despite US opposition, after rejecting a Hamas ceasefire proposal. * Israel banned Qatari news...

A political victory amidst the darkness
ECUADOR · Report · 10 May 2024

The past referendum and public consultation gave President Daniel Noboa a victory on nine out of the 11 questions proposed. This was a setback for the Correistas, who were campaigning for a “no” vote on all the questions. The winning questions all concerned crime control measures, while the two r...

Fiscal deficit expands on rapid expenditure growth
ISRAEL · In Brief · 10 May 2024

The fiscal deficit in the LTM rose to 7% GDP in April from 6.2% in March, but excluding the seasonal delay in revenues, the deficit stands at 6.7%. Spending is up 36% y/y in Jan-April while revenues are down 2.2% (nominal). We note that expenditure not related to the war is up 11.7%, which we see...

Inflation's downtrend ended in April, just as expected
HUNGARY · In Brief · 10 May 2024

The headline rate of CPI-inflation was 0.7% mom, 3.7% yoy in April, the latter rising marginally, from 3.6% yoy in March. Core inflation still dropped, to 4.1% yoy in April from 4.4% yoy in the previous month. Non-fuel inflation also decreased, to 3.7% yoy from March's 4.1%. Consumer prices rose ...

Congress overrode most of Lula’s vetoes to the Budget, Lula’s veto on the Betting Law was also overridden, and Haddad announced an agreement on the payroll tax relief issue
BRAZIL POLITICS · Report · 10 May 2024

The Plenary of the Congress overrode most of President Lula's vetoes to the 2024 Budget Law, increasing the value of permanent committee funds by R$4.2 billion—from R$11 billion to R$15.2 billion. Legislators also overrode Lula’s veto on the Betting Law, specifically the section on how Income Tax...

Watch the (monthly) pace and hope for the best
TURKEY · Report · 09 May 2024

The CBRT released the second Inflation Report of the year with a nice and comprehensive presentation by Governor Fatih Karahan (see link here for the transcript, here for the presentation). We provide some relatively detailed highlights on the presentation and the Q&A session, followed by comment...

On Victory Day Putin says Ukraine War is like WW II
RUSSIA / FSU POLITICS · In Brief · 09 May 2024

On May 9 Putin addressed a crowd in Moscow at the annual commemoration for the end of World War II. Putin denounced Western nations for twisting the history of WW II and for causing conflicts. He railed against Western neo-imperialism and its support for what he termed "neo-Nazism". Putin claimed...

COPOM Watch: The flight of the falcons
BRAZIL ECONOMICS · Report · 09 May 2024

As expected, the Monetary Policy Committee (COPOM) reduced the target SELIC rate by only 25 basis points at the last meeting, from 10.75% to 10.50%. However, the decision was not unanimous: all the Central Bank directors appointed by Lula voted to continue the cuts of 50 basis points per meeting,...

The Copom reduced the Selic by 0.25 percentage points, the Senate approved the new DPVAT, and Congress will analyze two bills to direct resources to Rio Grande do Sul
BRAZIL POLITICS · Report · 09 May 2024

Yesterday, the Central Bank's Monetary Policy Committee (Copom) reduced the basic interest rate (Selic) by 0.25 percentage points, interrupting a cycle of six consecutive cuts of 0.50 pp. The Selic fell from 10.75% to 10.50% per year. The Senate approved the new mandatory insurance policy for veh...

Russia: a brief market watch
RUSSIA ECONOMICS · In Brief · 09 May 2024

The ruble appreciated in the past two weeks from USD/RUB 94 to almost USD/RUB 91. We suppose that there were two main reasons for such dynamics. Firstly, efforts of the Russian exporters to repatriate export earnings to Russia appeared relatively successful. The settlement between the Russian com...

Israeli institutions sold FX in Q1 as global markets pushed higher
ISRAEL · In Brief · 09 May 2024

In Q1, Israeli institutional investors sold net $5.3 billion, following purchases of a similar volume in Q4. Sales in the first quarter derived mainly from sharp increases in global capital markets and not really due to optimism about the geopolitical environment. As of February, the rate of expo...

On campaign financing limits and an eventual impeachment of the president
COLOMBIA · In Brief · 08 May 2024 · 2 responses

Norms regulating campaign financing are simple and strict in Colombia. On May 8th, the National Electoral Council (NEC) is considering a draft ruling indicating that, in the 2022 presidential elections, Gustavo Petro’s campaign surpassed the financing limits. We follow the analysis of the renowne...

Pacheco enacted the Legislative Decree that recognizes the state of emergency in RS, new polls on government ratings were published, and the Copom should announce the new basic interest rate today
BRAZIL POLITICS · Report · 08 May 2024

Last night, the president of the National Congress, Rodrigo Pacheco (PSD-MG), enacted the Legislative Decree Bill that recognizes a state of public emergency in Rio Grande do Sul (RS) until December 31. Yesterday, another poll on the government’s ratings was published—the CNT/MDA poll. As other i...

Industrial output returned to a downward trend in March
HUNGARY · In Brief · 08 May 2024

Moving in a direction opposite to retail sales, industrial output fell by 3% mom, 2.9% yoy (volume terms, sda basis) in March. Here is the fixed-base chart (Dec 2010 = 100, KSH data): The recent downtrend of the industrial sector appears to reflect Europe's industrial weakness, as the same Hungar...