[snap]: Brazil hikes again
Brazil’s central bank has just raised interest rates by 25 basis points to 12.50 per cent, as widely expected by economists and the market.
From the central bank on Wednesday:
“Evaluating the expected outlook and the balance of inflation risks, Copom (the monetary policy committee) unanimously decided, at this moment, to raise the Selic rate to 12.5 per cent, without bias.” Continue reading »
Mexico’s economic Achilles heel
Some slightly sobering news from Mexico on Wednesday: May retail sales came in much lower than expected.
The figures, published by the country’s national statistics agency, showed that total sales increased just 1 per cent compared with the same month last year. That was way down on the 3.1 per cent consensus forecast, and Nomura Securities International’s 3.6 per cent estimate. Continue reading »
Kazakhstan: succession question looms
After hosting lavish celebrations for his 71st birthday, Nursultan Nazarbayev departed Astana for a “short vacation” last week, according to the Kazakh president’s website.
However, media reports that Nazarbayev, rather than holidaying has gone under the knife in a German hospital, are stoking questions about the future leadership of the oil rich central Asian country he has ruled with a firm hand for more than two decades. Continue reading »
Brazilian rates: predictable is good
Fast forward a few hours from this post and the headlines out of Brazil will look something like this:
RTRS-BRAZIL C.BANK RAISES SELIC 25 BPS TO 12.5 PCT
After months of uncertainty over Brazilian monetary policy, economists and traders are finally on the same page. Analysts are unanimously predicting that Brazil’s central bank will raise the benchmark Selic lending rate on Wednesday night by 25 basis points to 12.5 per cent – the fifth increase this year. Continue reading »
Warsaw Stock Exchange expands its reach
By Adam Easton in Warsaw
Already the largest bourse in the region, the Warsaw Stock Exchange seems poised to continue its expansion plans.
Following the lead of NYSE Euronext and Deutsche Borse, the WSE wants to broaden out from trading financial instruments to commodities, particularly energy products. For months it’s been trying to persuade the shareholders of the Polish Power Exchange (POLPX) to sell up and it now looks like it’s got its way. Continue reading »
Indian banking: goodbye branches, hello mobiles
If you are planning to open a bank in India here’s some free advice from the global management consulting firm McKinsey: forget bank branches, invest in online and mobile banking services.
Why? A survey of India’s consumer banking sector released on Tuesday by the management gurus in Mumbai shows that fewer people use branches than they did just four years ago amid booming internet and mobile phone services. Continue reading »
Apple Store? Yup, we can fake that too
From fake eggs to Louis Vuitton knock-offs, China’s counterfeiting prowess is well known.
But the country’s ever resourceful entrepreneurs have taken counterfeiting (and copyright infringement) to a whole new level with – get this – a whole fake Apple store, complete with a Genius Bar, transparent staircase and blue t-shirted staff.
That, at least, is what this expat found in Kunming, the capital of Yunnan Province in southwest China - and then she found two more. Continue reading »
Gulf petrodollars stay home for once
By Camilla Hall in Abu Dhabi
For years, petrodollars burnt holes in Gulf states’ pockets. What could not be spent at home, went straight into investments abroad. Buying US treasuries, London palaces or football clubs was a norm. But in the aftermath of the Arab spring, leaders in Middle Eastern countries have had to reconsider where to put their revenues. Instead of foreign assets and luxury, the surplus money is spent on creating jobs, building new homes and helping other states in the region. Continue reading »
Cnooc in $2bn deal for Opti Canada
Once again a Chinese company flush with cash has swooped to the rescue of a struggling developed world company. Cnooc announced on Wednesday that it would stump up a total of US $2.1bn to acquire Opti, just days after the oil sand producer said it was struggling to avoid default. US$34m of this total will go to Opti’s shareholders; the rest, US$2bn, will go towards Opti’s debt bill. Continue reading »
S Africa rates: steady as she goes
South Africa’s inflation edged up to 5 per cent year-on-year in June from 4.6 per cent the previous month, but analysts don’t expect the rise to alter the central bank’s outlook.
The bank is seen as a safe pair of hands where no news is usually good news. So analysts have given support to its cautious approach – and its willingness to look through short-term inflationary effects. Continue reading »
Brazil: a modest proposal
Banks have paid their staff in stock for years. Lots of companies do it, too. Even some public sector workers are on performance related pay. So why not go the whole hog and make entire populations, literally, stakeholders in their country’s future?
That, says Nuno Camara, Latin American strategist at Fortress, the New York-based private equity and hedge fund manager, is what Brazil should do if it wants popular backing for progressive reform. Continue reading »
Russian beer: crying in their cups
For decades, Kremlin leaders have been trying to crack down on the consumption of vodka, and its illegal cousin moonshine, in a bid to cut alcoholism and revive life expectancy. Now president Dmitry Medvedev and the state duma are targeting Russia’s favourite ‘non-alcoholic beverage’: beer.
While beer has escaped authorities’ attention until now, a bill signed into law by Medvedev on Wednesday will curb beer sales between 11pm and 8am, and ban it at drinkers’ favourite points of purchase: kiosks, airports and train stations.
New York headlines
Humala softens stance on Peru’s mining sector
Venezuela tops world oil reserves
Berlin and Moscow leaders foster trade ties
Vodafone seeks global private equity partner for India arm
Renault and Nissan plan Avtovaz parts tie-up Continue reading »
CEE Swissie loans: small for economists, big for borrowers
A Hungarian homeowner with a Swiss Franc mortgage might be forgiven for thinking otherwise, but Barclays Capital insists there’s not a lot to worry about in the recent plunge in CEE currencies against the Swissie.
BarCap says in a report on Wednesday that the macro-economic effects shouldn’t be exaggerated, given that SwFr mortgage repayments amount to just 1.7 per cent of gross domestic product in Hungary – and much less in Poland and Romania.
That’s very reassuring – if you’re not paid in forints. But the mortgage holders will carry on sweating, as will their political leaders. Continue reading »
Further reading: who is Wendi Deng?
Wednesday’s best picks from the beyondbrics team: how Sina Weibo (China’s version of Twitter) is a force for transparency in the property market, the Chinese market contributed to a third of Apple’s Q3 revenues, and Venezuela became the world’s biggest holder of oil reserves.
Also, a look the rise of Wendi Deng.
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