What Our Analysts Are Reading – 1/26/2018

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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.

Alex Schober on “With an increase of 3.9% in November, Argentina’s economy has consolidated its improvement”

“Argentina’s economic activity index (EMAE) grew 3.9% YOY in November, and 2.9% YTD. This adds further evidence to Argentina’s final real GDP growth being close to 3.0%. Construction, financial services, and commerce led November’s expansion.”

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Ryan Connelly on “GDP Grows 2.6% at Year End, Slowing a Bit but Still Steady”

“US GDP grew at 2.7% in 2017 – right in line with our forecast. Consumer spending grew at 2.7% (forecast 2.7%), picking up sharply in the 4th quarter. Most important, new investment in 2017 grew 3.2% (forecast 3.1%), driven by a surge in new equipment investment. Our outlook for US growth in 2018 remains very positive as we expect the new tax bill to drive further new investment and consumption.”

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JosefJosef Jelinek on “Trump administration backs bills to toughen foreign investment rules”

“US-China relations are set to remain tense throughout 2018 as fears over theft of intellectual property by Chinese government-led investment have created a political movement in the US calling for tough action against the world’s second-largest economy. Concerns remain as the White House also prepares it’s long promised crackdown on what it sees as China’s unfair trade practices.”

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Matthew KindingerMatthew Kindinger on “Angola central bank governor eyes move towards kwanza float”

“The Angolan central bank is considering whether a free float of the kwanza should occur this year. A free float would be inflationary in the short term, but it would allow for much improved access to foreign currency for MNCs, and make the country more attractive to foreign investors. A decision on the potential float is expected during Q2 2018.”

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Martin Belchev on “Pro-EU academic aims to unseat anti-immigrant Czech president in run-off”

“Having won in the first round of the presidential election, the controversial current president Zeman is now facing a steeper challenge, as his main opponent, the academic Jiri Drahos, has taken a lead in the polls. Drahos’s potential win can spell trouble for ANO, due to the his reluctance to give the mandate for forming a government to Andrej Babis, who already lost a confidence vote.”

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athanasia-kokkinogeniAthanasia Kokkinogeni on “Davos in the course of the European revival; Davos sous le signe du réveil européen”

“MNCs should anticipate improvements in WEUR markets if the European project goes ahead in the next couple of years, as the Franco German cooperation deepens on key issues. Common policies for defense, security, fiscal and economic integration, and trade could further strengthen the eurozone, and MNCs will make gains. Segmenting WEUR markets will remain key in identifying the emerging opportunities.”

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Ashu Agarwal on “Malaysia’s central bank raises key rate for first time in 3.5 years”

“Malaysia’s central bank has raised its benchmark interest rate for the first time in more than three years. The central bank raised interest rates due to increasing inflation, tightening US monetary policy, and strengthening economic conditions. As a result, companies can expect a more stable ringgit despite the three US interest rate hikes expected in 2018.”

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