What Our Analysts Are Reading – 11/10/2017

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Each week Frontier Strategy Group’s global team shares their view on key media stories, and what the implications are for businesses that operate in emerging markets. For more information about how to contact our analysts, send us an email.

athanasia-kokkinogeniAthanasia Kokkinogeni on “Berlusconi’s center-right leads in Sicily election — exit polls”

“MNCs should expect 2018 to be a year of renewed political risk for the eurozone, because of the Italian general elections. The populism Eurosceptic front – Five Star Movement, Forza Italia, Lega Nord – is strengthening ahead of the mid-2018 elections. This increases concerns over the Italian fragile banking sector, with less likely but still possible repercussions across the eurozone.”

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Adam JarczykAdam Jarczyk on “5 key moments from Trump’s South Korea speech”

“Trump’s direct criticism of Kim Jong-un during his recent visit to South Korea marks a further escalation in tensions; however, it does not mark a change in Washington’s stance. The US will still consider negotiating with North Korea as long as the conditions are right.”

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Dalia Naguib on “Saudi Arabia says Lebanon declares war, deepening crisis”

“Following Prime Minister Saad Hariri’s resignation and increased hostile rhetoric from Saudi Arabia, Lebanon faces a major political setback after numerous positive breakthroughs over the past year. Political uncertainty is likely to be prolonged, confidence in the market will weaken, and government initiatives are likely to be delayed.”

Link to article Read More of Dalia’s Commentary | Have a Question for Dalia?

Matthew Kindinger

Matthew Kindinger on “DR Congo vote date: What’s at stake?”

“A new agreement has been reached in Congo (DRC) on holding elections which will now take place in December 2018, two years after their original date. This is a minor victory for opposition parties, and comes after the US ambassador to the UN, Nikki Haley, applied pressure on President Kabila’s regime. However, protests and unrest will likely continue occurring until the elections take place.”

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Alex Schober on “After 21 straight months of contraction, Argentina retail sales grow 1.6%”

“B2C companies should expect a full consumption recovery to begin now that retail sales have finally increased after almost 2 years of contraction. Better access to credit and more financing options have increased household consumption of retail goods, and this trend should accelerate as inflation decelerates and purchasing power increases.”

Link to article | Read More of Alex’s CommentaryHave a Question for Alex?

Ryan Connelly on “OPEC Now Says U.S. Shale Will Grow Even Faster Than They Previously Thought”

“OPEC released their World Oil Outlook yesterday, and they sharply revised up forecasts of US shale output. This fits our base case view for $45-$65 Brent crude prices over the medium term. This revision may impact OPEC’s calculus over how long to extend production cuts. For more, see the oil price scenarios in the recently published FSG’s Events to Watch for 2018.”

Link to article | Read More of Ryan’s Commentary | Have a Question for Ryan?

Ashu Agarwal on “Asia c.banks: Malaysia, Philippines keep key rates unchanged”

“Following interest rate cuts across the ASEAN-5 countries (barring Thailand) in 2016-17, central banks across the region are expected to keep interest rates unchanged for the rest of the year to boost economic growth. MNCs can, therefore, expect substantial depreciation in the ASEAN currencies as the likelihood of a US interest rate hike in December increases.”

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