Can South Africa draw lessons from Brazil’s mistakes?

February 11, 2016

South Africa's Finance Minister Pravin Gordhan gestures during a media briefing to announce a new deputy governor of the central bank in Pretoria March 25, 2011. South African National Treasury Director General Lesetja Kganyago is to leave his position to become a deputy governor of the central bank from May 16, South African President Jacob Zuma said on Friday. REUTERS/Siphiwe Sibeko (SOUTH AFRICA - Tags: POLITICS BUSINESS) - RTR2KE94

Growth expectations for South Africa have tumbled in recent weeks as the government struggles with growing budget and trade gaps. Brazil walked a similar path a couple of years ago – but can South Africa draw any lessons from that spectacular fall?

German, Japanese industry on increasingly parallel lines

February 10, 2016

Workers assemble BMW i3 electric cars at the production line of the BMW factory in Leipzig September 18, 2013.  REUTERS/Fabrizio Bensch (GERMANY - Tags: TRANSPORT) - RTX13PQV

A global slowdown in manufacturing that began late last year is getting more entrenched, particularly in Germany and Japan, economies that increasingly seem to share a lot in common apart from being the world’s two best-known exporters of high-tech cars and electronics.

January jobs, wage data may give little clarity on Fed moves

February 5, 2016

Eric Lipps, 52, waits in line to enter the NYCHires Job Fair in New York December 9, 2009. While the jobless rate has edged down, high unemployment rate remains a political headache for President Barack Obama and fellow Democrats, who are worried they will lose seats in Congress in next November's elections if faster recovery is not faster. REUTERS/Shannon Stapleton (UNITED STATES BUSINESS EMPLOYMENT POLITICS IMAGES OF THE DAY) - RTXRNTC

Those expecting January’s U.S. payrolls and wages data to add clarity to the future of U.S. monetary policy may end up more confused instead, forecasts from the most accurate economists in Reuters polls suggest.

Floor getting lower for Chinese yuan

February 2, 2016

RTX23HPP.jpgWhen predicting the Chinese yuan, some forecasters seem to be coming around to the idea that calling an immediate floor on the currency may be a difficult call to make.

Brazil’s Congress reconvenes, mired in pessimism

February 2, 2016
A coffin that represents Brazil's President Dilma Rousseff burns during a protest calling for the impeachment of Rousseff in front of the National Congress in Brasilia, Brazil, December 13, 2015.  REUTERS/Ueslei Marcelino - RTX1YHDB

A coffin that represents Brazil’s President Dilma Rousseff burns during a protest calling for the impeachment of Rousseff in front of the National Congress in Brasilia, Brazil, December 13, 2015. REUTERS/Ueslei Marcelino

Is growth in euro zone bank lending to companies fizzling out?

January 29, 2016

The European Central Bank (ECB) President Mario Draghi addresses a news conference at the ECB headquarters in Frankfurt, Germany, January 21, 2016. The ECB held interest rates at record lows on Thursday, but the market crash, tumbling bank stocks and ebbing inflation may set the stage for action later in the year.   REUTERS/Kai Pfaffenbach - RTX23E79

A meaningful economic revival in the euro zone that has any hope of generating inflation pressures of its own rests mainly on a pickup in demand.

Kicking the can down the road on British rates – again

January 28, 2016

Bank of England Governor Mark Carney speaks during the bank's quarterly inflation report news conference at the Bank of England in London August 13, 2014. The Bank of England forecast on Wednesday that wages would grow far more slowly than previously expected and linked their rate of increase closely to borrowing costs, suggesting it was in no hurry to raise Britain's record low interest rates.  REUTERS/Suzanne Plunkett   (BRITAIN - Tags: BUSINESS POLITICS) - RTR4299J

Forecasts for when the Bank of England will raise rates have been put off into the future for the seventh time since Mark Carney became Bank of England Governor nearly three years ago.

ECB to highlight inflation downside

January 21, 2016

The European Central Bank is expected to keep all interest rates on hold at 1245 gmt but highlight increasing growth and inflation risks, raising the prospect of further policy easing later this year, possibly at its June meeting. Meeting for the first time since it cut rates and expanded its asset purchase programme in December, the ECB is expected to warn that inflation could stay ultra-low longer than an already downbeat forecast pegged on plunging oil prices, weak Chinese growth and the lack of decisive fiscal policy action at home. It will also be interesting what Mario Draghi has to say about turmoil in the bank sector with shares in Italian, Portuguese and Greek lenders plunging on concerns the ECB may eventually force them to take a loss on some of their bad loans, reducing their ability to pay dividends. The press conference is at 1330 GMT.
Nearly a decade after the murder of Kremlin foe Alexander Litvinenko with a cup of green tea laced with Polonium-210, an rare isotope mainly produced in Russia, the British inquiry into his death is due to give some answers at around 0930 GMT.  To what extend was the Russian state involved? And if so, did the order come from the Kremlin’s own former KGB agent in chief Vladimir Putin? Any finger-pointing in the direction of the Kremlin will increase diplomatic pressure on the British government to confront Moscow on the affair; however wider geopolitical prerogatives, among them the need to keep Russia on board in the international push for an end to the conflict in Syria, may tone down any reaction.
Meanwhile his 1300 GMT speech at Davos is the perfect forum for David Cameron to urge business to get behind his push for Britain to remain in a “reformed” EU. So far, some companies have been reluctant to stick their neck on the line either way for fear of annoying clients or staff, but there will be greater readiness to do so once reform negotiations have been concluded, possibly as early as next month. Goldman Sachs, it emerges, has already put its money where its mouth is and given a six figure sum to the campaign for Britain to stay in the European Union.
Italy’s government is following with concern a rout in domestic banking shares but insists the system is solid. In an interview with financial daily Il Sole-24 Ore, Prime Minister Matteo Renzi rejects the idea that Italy is facing another 2011 style crisis and insists that current events will ease mergers, tie-ups, purchases. Expect more in the same vein from his news conference at 0900 GMT

Reserve Bank of India may cut rates even more than expected this year

January 20, 2016

Reserve Bank of India (RBI) Governor Raghuram Rajan attends a news conference in Mumbai, India, December 1, 2015. REUTERS/Shailesh Andrade - RTX1WLY7

The Reserve Bank of India is widely expected to cut interest rates just once in 2016, as most analysts see retail inflation rising slightly above the central bank’s target, but there is a decent chance it could cut more aggressively, as it did last year.

Canada’s central bank still dreaming of an export recovery

January 19, 2016

Bank of Canada Governor Stephen Poloz looks on during a Canada-UK Chamber of Commerce event in central London March 26, 2015. REUTERS/Stefan Wermuth   - RTR4V02N

The dramatic plunge in the Canadian dollar must surely be a test of optimism, and patience, for Bank of Canada Governor Stephen Poloz.