South Africa: Structural Issues to Dominate Long Term Growth

January 29, 2024 9:00 AM UTC

Bottom line: We expect 1.3-1.5% GDP growth in South Africa in the 2025-2030 period. We are concerned with the structural problems affecting economic dynamics negatively, including loadshedding, transportation bottlenecks, and shrinking trade surplus. Despite structural problems; growing population,

EM FX Outlook: USD Decline v Inflation Differentials

December 19, 2023 9:59 AM UTC

·        In spot terms, we see the Indonesian Rupiah (IDR) and Malaysian Ringgit (MYR) rising against the USD as Fed rate cuts narrow interest rate differentials and a move away from an overvalued USD occurs.  Brazilian Real (BRL) and Mexican Peso (MXN) will likely be stable against the USD

Moderate Increase in Turkiye’s Inflation in November

December 4, 2023 11:28 AM UTC

Figure 1: CPI (YoY, % Change) and Policy Rate (%), January 2021 – November 2023
Source: Turkish Statistical Institute, Datastream, Continuum Economics
When annual rate of changes (%) in the CPI's main groups are examined in November, we see that housing with 37.5% was the main group with the lowest

Turkish Economy Expands 5.9% in Q3 2023

November 30, 2023 1:40 PM UTC

Figure 1: GDP (%, YoY), Q3 2019 – Q3 2023
Source: Datastream, Continuum Economics
When the activities which constitute GDP are analyzed in Q3, construction sector made the highest contribution to the economy with an 8.1% YoY rise, followed by 5.7% in the industry sector and 5.1% in the financial and

Russian Economy Grows by 5% in October

November 29, 2023 7:11 PM UTC

Figure 1: Industrial Production (%, YoY), October 2020 – October 2023
Source: Datastream, Continuum Economics
The Russian economy continues to grow fast in 2023 so far, after partly relieved from the negative impacts of the war in Ukraine in 2023. The Russian economy grew by a strong 5% YoY in Octob

SARB Holds Key Rate at 8.25% at Third Straight MPC

November 24, 2023 10:11 AM UTC

Figure 1: CPI Inflation Rate, October 2021 – October 2023
Source: Datastream
Under surging inflationary concerns, SARB decided to keep the repo rate at 8.25% on November 23 MPC. While the hold was widely expected, high inflation numbers on November 22 did raise some eyebrows. Despite this, it appe

Sixth Straight Rate Hike: CBRT Continued Strong Monetary Tightening

November 23, 2023 12:53 PM UTC

Figure 1: Key Rate (%), September 2020 – November 2023
Source: Datastream
The CBRT raised the policy rate from 35% to 40% on November 23 MPC meeting to establish the disinflation course as soon as possible, to anchor inflation expectations, to control the deterioration in pricing behaviour and to s

The Bells Are Tolling as the Spiking Cycle Continues: South Africa’s Inflation Jumped to 5.9% in October

November 22, 2023 3:48 PM UTC

Figure 1: CPI Inflation Rate, October 2021 – October 2023
Source: Datastream
Price increases in food and fuel were remarkable last month, which directly hit the consumers purchasing power. Inflation for food and non-alcoholic beverages accelerated for a second consecutive month, rising to 8.7% in O

Ukraine War: Western Support Weakens, Elections on the Horizon, Peace Negotiations Remains Unlikely

November 20, 2023 11:28 AM UTC

Market Implications: The war continues to create an increasing financial burden on Russia due to high military spending in addition to aggravation of staff shortages, elevated inflation, and trade income diminishing due to sanctions. Ukraine's economy continues to contract, inflation surges, and inf

Russian Economy Expands by 5.5% in Q3, Rosstat Reports

November 15, 2023 5:25 PM UTC

Figure 1: GDP Growth (%, YoY), Q3 2020 – Q3 2023
Source: Datastream, Continuum Economics
The Russian economy continues to grow fast in 2023 so far, after partly relieved from the negative impacts of the war in Ukraine. (Note: Russian GDP decreased by 1.8% in Q1 2023, and grew by 4.9% in Q2.) The mai

South Africa: Structural Issues to Dominate Long Term Growth

November 14, 2023 1:07 PM UTC

Figure 1: South Africa GDP Growth Forecasts to 2030 (%)
Source: Continuum Economics
Figure 2: Population Forecasts to 2030 (Thousand)
Source: Continuum Economics
Technology is also one positive driver of productivity in the 2020's alongside increased climate change investments but the impacts of Tec

Russia: War Related Sanctions and Shrinking Labor Force Pose Threats to Long Term Growth

November 9, 2023 12:02 PM UTC

Figure 1: Russia GDP Growth Forecasts to 2030 (%) 
Source: Continuum Economics/Datastream
Figure 2: Russia Population Forecasts to 2030 (Thousand)
Source: Continuum Economics/Datastream
Figure 3: Russia Industrial Production Forecast to 2030 
Source: Continuum Economics/Datastream
Technology is also o

Turkish Inflation Continued Its Spiking Cycle in October

November 3, 2023 8:08 AM UTC

Figure 1: Inflation (YoY, % Change), October 2018 – October 2023
Source: Turkish Statistical Institute, Datastream, Continuum Economics
When annual rate of changes (%) in the CPI’s main groups are examined in October, we see that housing with 25.9% was the main group with the lowest annual increas

Russia’s GDP Grew Faster Than Expected in January - September 2023

November 1, 2023 2:23 PM UTC

Figure 1: Industrial Production (%, YoY), October 2018 – September 2023
Source: Datastream, Continuum Economics
The main accelerator for Russian growth continues to be the surge in the military spending after the war in Ukraine started. Despite there being a pause on territorial advance by Russia o

Charting our Views: October 2023

October 31, 2023 11:11 AM UTC

Download the PDF on the left to see our key economic and asset class views

CBR Maintains Strong Hawkish Stance by Lifting the Rate to 15%

October 27, 2023 1:34 PM UTC

Figure 1: $/Ruble, October 2022 - October 2023
Source: Datastream
According to the Monetary Policy press release by the CBR today, CBR remained concerned about multiple issues such as higher inflationary pressure seen across an increasingly broader range of goods and services, growing domestic dema

CBRT Continued Strong Monetary Tightening on October 26 MPC

October 26, 2023 3:35 PM UTC

Figure 1: Key Rate (%), September 2020 – October 2023
Source: Datastream 
The CBRT raised the policy rate from 30% to 35% on October 26 MPC meeting to establish the disinflation course as soon as possible, to anchor inflation expectations, to control the deterioration in pricing behaviour and to s

CBRT will Likely Halt Tightening Cycle Transiently on October 26 MPC

October 19, 2023 10:52 AM UTC

Figure 1: Key Rate (%), September 2020 – September 2023
Source: Datastream 
Despite inflation remained on the upside in September (there are still signs that inflation will continue to spike in the upcoming months mostly due to deterioration in pricing behaviour), cost and demand pressures and slo

South Africa’s Inflation Spiked to 5.4% in September

October 18, 2023 12:10 PM UTC

Figure 1: CPI Inflation Rate, October 2021 – September 2023 
Source: Datastream
Annual CPI amounted to 5.4% in September 2023, up from 4.8% in August. The food and non-alcoholic beverages contributed to the 5.4% annual inflation rate by 1.4 percentage points; housing and utilities by 1.3 percentage

Russia’s Inflation Surged Fast in September

October 12, 2023 6:05 PM UTC

Figure 1: CPI Inflation Rate (%, YoY), September 2022- September 2023
Source: Datastream, Continuum Economics
According to Rosstat, prices of food, non-food products and services rose by 0.86%, 1.09% and 0.61% on a monthly basis in September, respectively. The consumer price index (CPI) also hiked by

South Africa’s Inflation is Expected to Increase in September

October 10, 2023 1:15 PM UTC

Figure 1: CPI Inflation Rate, October 2018 – August 2023 
Source: Datastream
First, the weakening currency remained as one of the major risks against the inflation outlook. USD to Rand rate fell to a four-month low to 19.57 as of October 5 and the lagged feedthrough of previous declines is still fe

South Africa’s Current Account Deficit Remains Cloudy in 2023

October 4, 2023 1:38 PM UTC

Figure 1: Current Account Balance (Million Rand), November, 2018 – May, 2023
Source: Datastream, Continuum Economics
Figure 2: Foreign Trade (Million Rand), November, 2018 – May, 2023
Source: Datastream, Continuum Economics
After experiencing current account deficits (CAD) every year for nearly tw

Russia’s Inflation is Expected to Continue to Surge in September

October 3, 2023 7:50 AM UTC

Figure 1: $ to Ruble Rate, September 2022- September 2023
Source: Datastream, Continuum Economics
After food prices rose by 3.6% in annual terms, the cost of services surged by 9.5% in annual terms and yearly diesel fuel prices hiked by 4.1% in August, we expect rising patterns to continue in Septembe

Turkiye Struggles its Way out of Current Account Deficits

October 2, 2023 8:05 AM UTC

Figure 1: Decomposition of Current Account Balance (% of GDP), 2022
Source: Turkish Statistical Institute (Turkstat), Central Bank of Republic of Turkiye (CBRT)
Figure 2: Turkish Foreign Trade (Thousand USD), January – August, 2023
Source: Turkish Statistical Institute
Turkiye has continued to recor

Charting our Views: September 2023 Outlook

September 29, 2023 9:54 AM UTC

Download the PDF on the left to see our key economic and asset class views

Outlook Overview: Into 2024

September 28, 2023 10:04 AM UTC

Risks: DM countries could see stronger lagged effects on the economy from the 2022-23 monetary tightening that could prolong the EZ/UK recession or move the U.S. slowdown towards a mild recession. Separately, in China the impact of the residential construction decline could be stronger than expected

South Africa’s Inflation Slightly Rose in August

September 21, 2023 6:18 AM UTC

 Figure 1: USD Rand Rate, September 2021 – July 2023 
Source: Datastream
Despite the fall in headline inflation accelerated in June and July as inflation for food and non-alcoholic beverages (NAB) slowed, and fuel prices and transportation costs partly eased, the inflation outlook worsened in Augu

CBR Maintains Hawkish Stance by Lifting the Rate to 13%

September 15, 2023 2:13 PM UTC

Figure 1: $/Ruble, September 2020 - September 2023
Source: Datastream
Despite general consensus among economists forecasting no change in the key rate on September 15, CBR surprised the analysts. (Note: Our prediction was a hike by 50 bps to 12.5%). As specified by the Monetary Policy press release by

Inflation Alarming: Russia’s Inflation Surged to 5.2% in August

September 11, 2023 8:10 AM UTC

Figure 1: CPI (%, YoY), January 2021 - August 2023
Source: Datastream, Continuum Economics
According to Rosstat, food prices rose by 3.58% in annual terms, while prices of non-food products soared by 1.14% on a monthly basis and by 3.5% compared to August 2022. The cost of services surged by 9.54% in

Charting our Views: September 2023

September 7, 2023 3:18 PM UTC

Download the PDF on the left to see our key economic and asset class views

Exceeding Expectations: South Africa’s GDP Expanded by 0.6% in Q2

September 6, 2023 6:32 AM UTC

Figure 1:GDP (% YoY)
Source: Department of Statistics of South Africa
According to Department of Statistics of South Africa, 6 of 10 industries recorded growth in Q2, as agriculture (4.2%), manufacturing (2.2%), and finance (+0.7%), lead the way. We foresaw the growth in manufacturing in Q2 as recent

Turkish Inflation Continued to Surge in August

September 4, 2023 1:12 PM UTC

Figure 1: Inflation Outlook (YoY, % Change)
Source: CBRT, Turkish Statistical Institute, Datastream, Continuum Economics
When annual rate of changes (%) in the CPI’s main groups are examined in August, we see that housing with 24.9% was the main group that indicated the lowest annual increase while

Russian GDP Grew by 1.6% in 1H 2023

September 1, 2023 10:03 AM UTC

Figure 1: GDP (%, YoY), Q3 2018 – Q2 2023
Source: Datastream, Continuum Economics
The predictions for Russian GDP remain positive despite the ongoing Ukraine war. Russian Finance Minister Anton Siluanov said on August 26 that Russia's economy is expected to grow by 2.5% or more in 2023. Central Ban

Turkish GDP Expands 3.8% in Q2 2023

August 31, 2023 2:41 PM UTC

Figure 1: GDP (%, YoY), Q3 2018 – Q2 2023
Source: Datastream, Continuum Economics
When the activities which constitute GDP are analyzed in Q2, we see that the value added increased by 6.4% in services, 6.2% in construction, 5.1% in public administration, education, human health and social work activ

August 30, 2023 6:49 PM UTC

Figure 1: Inflation and Core Inflation (%), August 2022 – July 2023 
 Source: Datastream
Despite the fall in headline inflation accelerated in June and July as inflation for food and non-alcoholic beverages (NAB) slowed for the fourth successive month in July, and fuel prices and transportation c

South Africa’s Government Debt Darkens Financial Outlook

August 28, 2023 9:24 AM UTC

Figure 1: General Government Overall Balance and Primary Balance, 2014-2028 (% GDP) 
Source: IMF
Figure 2: General Government Revenue and Expenditure 2014-2028 (% GDP) 
Source:IMF
According to the IMF Fiscal Report in April 2023, South Africa’s general government fiscal balance (% of GDP), which rec

Strong Move by CBRT: Key Rate Hiked by 750 bps to 25%

August 24, 2023 1:00 PM UTC

Figure 1: Key Rate (%), August 2021 – August 2023
Source: Datastream 
After CPI rising to 47.8% y/y in July and the outlook for inflation remaining on the upside, CBRT immediately decided to lift its inflation projection from 22.3% to 58% for 2023 in July. In addition, as there are strong signs th

South Africa’s Inflation Further Eased in July, Hitting Lowest in Two Years

August 23, 2023 5:28 PM UTC

Figure 1: CPI (%, y/y) January 2019 – July 2023
Source: Datastream
When we check the composition of inflation, the decline in fuel prices was remarkable in July, which weakened the upward push of transport on consumer inflation. According to the Department of Statistics, the annual rate for fuel was

South Africa’s GDP Expected to Mildly Contract in Q2 after Expanding by 0.4% in Q1

August 21, 2023 3:40 AM UTC

Figure 1: Real GDP (constant 2015 prices, seasonally adjusted)
Source: Department of Statistics of South Africa
According to Department of Statistics of South Africa, total demand was buoyant in Q1 particularly fuelled by government consumption, household consumption, investment and net exports. As

Turkiye’s Path Towards the End of 2023 is Bumpy

August 17, 2023 9:54 AM UTC

Figure 1: CPI (%, YoY) and Policy Rate (%), January 2020 – July 2023
Source: Datastream 
Inflation remains as the core problem which should be addressed as cost of living bites Turkish citizens. With CPI inflation coming in at 47.83% y/y in July, the outlook for inflation remains on the upside (Fi

Turkiye is Expected to Hike Key Rate to 20% on August 24 as Inflation Bites

August 16, 2023 10:12 AM UTC

Figure 1: CPI (%, YoY), January 2021 – July 2023
Source: Datastream 
First, with CPI inflation coming in at 47.83% y/y in July, the outlook for inflation remains on the upside (Figure 1). We predict that inflation will continue to surge in the upcoming months mostly due to recent hikes in taxes a