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Emerging Markets

Tariff Frontrunning Distorts Global Trade
East Asian trade data has been disappointing. Preliminary February data for Japanese machine tool orders showed a slowdown to 3.5% y/y from 4.7% in January. Broader machinery orders were down 3.5% m/m in January. Taiwanese exports orders were up an abnormal…
Daily Insights by Felix-Antoine Vezina-Poirier
Downgrading Brazilian Equities
Our Emerging Market strategists downgraded Brazilian equities as public debt dynamics deteriorate and macro fundamentals weaken. While they previously maintained a neutral stance despite being bearish on the Bovespa, the risks have become too pronounced to…
Daily Insights by Felix-Antoine Vezina-Poirier
South Africa: The Coalition Government Honeymoon Is Over
Our Emerging Market strategists reviewed their recommendations on South African assets as economic prospects start fading. South Africa’s fiscal tightening will suppress growth without achieving the necessary 4.2% primary surplus to stabilize public…
Daily Insights by Felix-Antoine Vezina-Poirier
Brazil: Stuck Between A Rock And A Hard Place

Brazilian policymakers are stuck between a rock and a hard place. There is no combination of fiscal and monetary policies that can assure decent growth, on-target inflation, a stable exchange rate, and public debt sustainability. We recommend investors maintain an underweight allocation to Brazilian fixed-income markets versus their EM peers and continue shorting BRL versus MXN. We have been bearish on the Bovespa in absolute terms and are now downgrading Brazilian stocks from neutral to underweight within an EM equity portfolio.

Emerging Markets Strategy by Juan Egana, Arthur Budaghyan
China's Housing Market: Still Adrift In Troubled Waters
Our China strategists published a quick note on China’s property market following the release of housing data earlier this week. China’s housing market is showing early signs of stabilization after three years of crisis, though a full recovery remains…
Daily Insights by Felix-Antoine Vezina-Poirier
South Africa: The Coalition Government Honeymoon Is Over

The South African government seems to believe that some fiscal retrenchment can stabilize the public debt-to-GDP ratio. But that’s a misconception. The country will need draconian spending cuts to achieve this.

Emerging Markets Strategy by Rajeeb Pramanik
China: Expect Growth To Soften After Strong Q1 Seasonality
Outside of the real estate sector, Chinese activity was decent in January and February. Both industrial production and retail sales were slightly stronger than expected. The jobless rate ticked up to 5.4% while property investment was down -9.8%…
Daily Insights by Felix-Antoine Vezina-Poirier
Understanding Trump's Foreign Policy

Trump’s foreign policy can be explained by rational US interests, but it requires settling the trade war with allies sooner rather than later. Book gains on EUR-USD for now.

Geopolitical Strategy by Matt Gertken
A Crude Paradox: OPEC Hikes Despite China Slump
Our Commodities strategists assessed the outlook for oil as crude remains pulled between geopolitical and fundamentals forces. OPEC+’s decision to raise oil supply is driven more by geopolitics than economics. A sustained improvement in Chinese oil…
Daily Insights by Felix-Antoine Vezina-Poirier
Key Takeaways From The National People’s Congress
Our China and Emerging Markets strategists assessed China’s outlook after the National People’s Congress concluded last week. China’s latest fiscal stimulus is only marginally larger than last year’s, with a combined credit and fiscal impulse of 3.8% of…
Daily Insights by Felix-Antoine Vezina-Poirier

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