Happy 2012! Brazil’s new year bond sale
What better way to start the new year than by holding a bond sale and showing everyone who is boss.
Brazil once again flaunted its enviable position in global debt markets on Tuesday by selling $750m of its 2021 dollar-denominated bonds at a yield of 3.449 per cent (150 basis points above comparable US Treasury bonds). Continue reading »
Cristina’s cancer rating boost
Cristina Fernández, Argentina’s president, faces surgery on Wednesday which doctors say should nip her early-stage thyroid cancer in the bud.
What the three-hour surgery is also expected to do is give a fresh fillip to the popularity of the Argentine leader, who won a landslide re-election victory in October and has maintained high ratings, despite controversial recent measures such as a bid to stem rampant capital flight via foreign exchange controls. Continue reading »
Turkey: 2012′s first bloodbath
Not a great start to 2012. In what Benoit Anne of SocGen described as “the first bloodbath of the New Year”, rates on Turkish one-year currency swaps surged by more than 60 basis points on Tuesday after inflation in the 12 months to December came in at 10.4 per cent, way above target, and the central bank continued to sell dollars to prop up the lira.
But the flood of data shouldn’t distract attention from Turkey’s big issue: its huge current account deficit of about 10 per cent of GDP. That problem is now so serious and pressing that Turkey may already have abandoned the “interest rate corridor” at the heart of its unorthodox and controversial monetary policy. Continue reading »
Hungary: new year, more debt problems
If Viktor Orban, Hungary’s recently-elected PM, was under any illusions that a two-thirds parliamentary majority would make life easy, Tuesday may have delivered something of a wake-up call.
In his inbox: protests over constitutional changes; international condemnation; and a small matter of bond yields at a two-and-a-half year high (not to mention recent downgrades by ratings agencies). On Tuesday Hungary sold three-month treasury bills at their highest yield since 2009, in the first debt auction since controversial new laws were passed that have put the possibility of assistance from the IMF and the EU in jeopardy. Continue reading »
12 for 2012: Indonesia needs a steady hand on the tiller
This post is the sixth of a series – 12 for 2012 – that beyondbrics is running on key emerging markets topics for the coming year.
By Milan Zavadjil of the International Monetary Fund
Despite the escalation of the eurozone crisis and gloomy global prospects, confidence remains high in Indonesia that strong growth can be sustained. But how is the country really positioned should the world economy face a downturn? Continue reading »
Bentley rides China’s love of luxury
As fears of sluggish global growth continue to infect both developed and emerging economies, it might seem a difficult time to be a luxury car maker.
Not for British brand Bentley, which is owned by German auto giant Volkswagen. The car synonymous with opulence has seen a 37 per cent rise in sales for 2011, buoyed by blossoming demand in China. Continue reading »
Vietnamese use dollar at their peril
Famous guests at Hanoi’s leading five-star hotel, the Sofitel-managed Metropole, have included actor Charlie Chaplin, novelist Graham Greene and, in the last few weeks, Mark Zuckerberg, founder of Facebook.
But the French colonial-era hotel has also had some rather unwelcome visitors recently in the shape of the enforcement department from the central bank, which is trying to crack down on the widespread use of dollars in Vietnam’s shaky economy. Continue reading »
New York headlines
* Iran threatens US over aircraft carrier
* International banks ramp up presence in Africa
* Biggest economies face $7.6 trillion bond tab
* Economists see bleak year ahead
* Bulk of emerging nations struggle through 2011 Continue reading »
Nigeria: so long to the fuel subsidy
After a long, loud build-up Nigeria’s battle of the fuel subsidy got serious over a very quiet New Year’s weekend. If the government had hoped a muted announcement would lead to a muted reaction they were, to put it mildly, disappointed.
The removal of the subsidy led to a doubling of fuel prices on Monday morning, according to Reuters, and an unsurprisingly furious reaction from Nigerians for whom the subsidy had represented one of the few tangible benefits they received as citizens of Africa’s largest crude-oil producer. Continue reading »
Further reading: let the masses shop
Tuesday’s top picks from the beyondbrics team: China’s resilient consumption; fresh political turmoil in Hungary over its constitution; the White House ending its soft line on Russia; North Korea’s new leader flexes his authority; and the need for a new electoral system in South Africa. Continue reading »
China PMI: beware the calendar effect
China did its bit to get 2012 off on the right foot, delivering a significant surprise lift in its official PMI for December that has given a glimmer of hope to markets shaking off their holiday slumber.
Not to spoil this hopeful start to the new year, but a deeper look at the numbers – and at the differences between the Gregorian calendar and China’s lunar calendar – suggests the initial flush of optimism might be overdone. Continue reading »
London headlines
* Biggest economies face $7.6 trillion bond tab
* Economists see bleak year ahead
* Bulk of emerging nations struggle through 2011
* Year-end bets against euro hit record Continue reading »
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