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Macro Economic News Update May 2017

11 May 2017
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GDP contracted by 2.5% year-on-year in Q4 with an overall contraction of 3.6% in 2016. Economists surveyed by Brazil’s central bank forecast GDP growth at only 0.5% in 2017. EIU forecasts growth at 0.2% for 2017.

EIU 9Mar17; FT “Brazil’s economy shrinks 3.6% in 2016” 7Mar17

The La Escondida mining strike could push Chile into recession when Q1 results are announced. The economy had contracted by 0.4% in Q4 2016 from Q3.Sebastian Pinera, the anticipated winner of the 2017 presidential election has pledged to spend $20bn on infrastructure development to
push economic growth.

Reuters 5th May, FT 19th April

GDP grew 0.6% from Q4 2016 and was up 2.7% year-on-year. Services continue to be the main driver of growth. No sign yet of growth decline with the backdrop of strained relationships with USA.

Fox Business 28th April

GDP in Q1 grew at an annual rate of 6.9%,the strongest quarterly performance in 18 months on the back of robust industrial activity, property investment and credit growth. There is some caution though that growth is paired with rising levels of corporate debt with credit growing at twice
the rate of the underlying economy.

FT 17th April

The UN has recently downgraded economic growth for 2017 from 7.7% to 7.3% but has predicted a rise to 7.9% for next year. It cautions that stressed balance sheets in the banking sectors will prevent strong investment rebound in the near term.

Times of India 16th May

In Egypt, the GDP growth rate slowed in Q1 ‘16/’17 to 3.4% y-o-y from 4.5% in the previous quarter. Growth is forecast to average 3.2% in 2017.

NKC 22Mar17

Tunisia’s economy grew 2.1% in Q1 2017. The tourism, agriculture and mining sectors were the main drivers of growth in this quarter. 2017 GDP is forecast at an average of 1.9%.

News24 15May17

Growth came in at 5.8% for 2016 driven mainly by the services and industry sectors. However, the economy saw a slowdown in H2 2016, with weakness expected to continue into 2017. GDP growth is forecast to average 5.4% in 2017.

EIU 20Apr17; Oxford Economics 18May17

GDP contracted by 1.5% in 2016. The main reasons for the contraction were tight foreign currency liquidity, delays to the implementation of the budget and decline in oil output in the Delta region due to acts of sabotage. However, oil production is recovering since repairs have been made
to oil infrastructure.

Oxford Economics 15Mar17

South Africa
GDP contracted by 0.3% quarter-onquarter in Q4 ‘16 with growth for 2016 coming in at only 0.3%. Mining and manufacturing sectors (account for
more than 20% of GDP), with declining production, contributed to the poor performance of the economy. S&P and Fitch lowered South Africa’s sovereign credit rating to sub-investment grade which increased risks to a modest improvement in 2017 growth expectations.

NKC 7Mar17; Oxford Economics 12May17

South East Asia
Q1 GDP growth in Singapore may be revised upwards following stronger than expected industrial performance in March, particularly in the electronics sector. Currently at 2.5% year on year, this could increase to 2.7% following the adjustment. Malaysia’s economy is expected to pick up slightly this year to 4.4% on the back of weaker ringgit supporting exports.

Straits Times 26th April, The Edge 26th April

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