Each week FrontierView’s global research team shares their view on key media stories, and what the implications are for your business. Have a question for our analysts? Email us at info@frontierview.com to learn more.
Kinnari Gurnani on “India’s Bond Market Could Benefit From Some Sin”
“The issuance of foreign currency bonds by the Indian government is aimed at opening a new avenue to finance government expenditure at a relatively low cost. This move will also make it easier for Indian companies to issue dollar-denominated debt, thus providing them with a new source of borrowing without having to depend on the tight domestic financial market.”
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Emilie Newton on “Canada Central Bank, Holding Steady, Flags Trade Concerns”
“The Bank of Canada will hold rates steady at 1.75% due to an underlying healthy labor market, stabilizing housing sector, and bump in oil production. We expect rates to remain steady in 2019 due to internal strengths, even as we expect the US Fed to cut rates in late July. The CAD has performed well this year against G10 basket currencies due to a rebound in the economy.”
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Ashu Agarwal on “No Surprises as Malaysia Central Bank Holds Rates Steady”
“Inflation will likely remain low this year as the central bank takes a cautious approach to lower interest rates. Hence, manufacturers and importers will struggle to increase prices to pass the cost of the new sales tax imposed on them onto their customers. This problem arises due to a shift away from the previous GST, which was an ad-valorem tax that spread the tax burden across the supply chain.”
Link to Article | Have a Question for Ashu?
Alejandro Valerio on “Mexico’s Finance Minister Urzua Quits, Posts Scathing Resignation Letter”
“Mexico’s Finance Minister, Carlos Urzua, has resigned over disagreements with policy decisions made without “sufficient foundation”. Urzua’s resignation, who was viewed as a moderate, will further decrease the country’s outlook, which has turned negative after lower-than expected CAPEX cuts in H1 due to regulatory uncertainty, and has prompted some FX volatility (the peso just fell over 1.3%).”
Link to Article | Have a Question for Alejandro?
William Attwell on “Tanzania Bows to Pressure to Amend Law on Statistics”
“The legislative amendment will go some way towards improving the operating environment in Tanzania by easing restrictions on gathering and disseminating data – an issue that had previously threatened to hamper MNCs’ ability to gain granular market insights from their distributors. However, other restrictions, e.g. on journalists and opposition politicians, are likely to remain in place.”
Link to Article | Have a Question for William?
Emilie Newton on “Bank of Canada to Remain on Hold This Week”
“Strong domestic performance will push the Bank of Canada to hold rates at 1.75% for the next year, regardless of a US rate cut. Canada, particularly Ontario and British Columbia, remains an attractive investment location for foreign businesses looking to trade with the US and take advantage of a relatively weak CAD. This will remain the case even as slight appreciation occurs if the US cuts rates.”