15 Jun 2015
Inflation and retail sales, highlights in the EM space – BBH
FXStreet (Edinburgh) - The research team at BBH reviewed this week’s main releases in the EM universe.
Key Quotes
“Israel reports May CPI Monday, expected at -0.4% y/y vs. -0.5% in April. Q1 GDP will be reported Tuesday. The central bank continues to buy USD in an attempt to weaken the shekel. Despite continued deflation, the bank seems hesitant to use unconventional measures again and so for now will rely on a weak currency for stimulus”.
“Brazil reports April retail sales Tuesday, expected to rise 0.7% m/m vs. -0.9% in March. It reports April GDP proxy Wednesday, expected -2.4% y/y vs. +0.5% in March. Mid-June IPCA inflation will be reported Friday, expected to rise 8.64% y/y vs. 8.24% in mid-May. COPOM minutes suggest another 50 bp hike in July, and some are even pricing in another 25 bp move after that in September”.
“South Africa reports May CPI Wednesday, expected to remain steady at 4.5% y/y. Core is also seen remaining steady at 5.6% y/y. April retail sales will also be reported that day, expected to rise 2.1% y/y vs. 2.0% in March. The nation faces a stagflation-type scenario. SARB next meets July, and we hope that Governor Kganyago does not hike rates as he has threatened. Real sector data remain soft, while inflation is clearly not demand-led”.
Key Quotes
“Israel reports May CPI Monday, expected at -0.4% y/y vs. -0.5% in April. Q1 GDP will be reported Tuesday. The central bank continues to buy USD in an attempt to weaken the shekel. Despite continued deflation, the bank seems hesitant to use unconventional measures again and so for now will rely on a weak currency for stimulus”.
“Brazil reports April retail sales Tuesday, expected to rise 0.7% m/m vs. -0.9% in March. It reports April GDP proxy Wednesday, expected -2.4% y/y vs. +0.5% in March. Mid-June IPCA inflation will be reported Friday, expected to rise 8.64% y/y vs. 8.24% in mid-May. COPOM minutes suggest another 50 bp hike in July, and some are even pricing in another 25 bp move after that in September”.
“South Africa reports May CPI Wednesday, expected to remain steady at 4.5% y/y. Core is also seen remaining steady at 5.6% y/y. April retail sales will also be reported that day, expected to rise 2.1% y/y vs. 2.0% in March. The nation faces a stagflation-type scenario. SARB next meets July, and we hope that Governor Kganyago does not hike rates as he has threatened. Real sector data remain soft, while inflation is clearly not demand-led”.