Oxford Economics Services

Spain Highlights and Key Issues Growing problems in the Spanish banking sector have become the focal point of investor concerns, following the partial nationalisation of the country s third-largest bank. The government has announced that it will require lenders

Country Economic Forecast: ## May #### Romania Highlights and Key Issues The Romanian government collapsed at the end of April and has been replaced by the opposition grouping ­ the USL Alliance ­ headed by Prime Minister Victor Ponta. This prompted a

Pakistan Highlights and Key Issues We still expect GDP growth to be only about #% in the ####/## fiscal year, at the foot of the SBP s latest forecast of #-#% and little better than the #.#

Gabon Highlights and Key Issues GDP growth in #### is estimated at about #%, much the same as in ####, underpinned by the surge in world oil prices that swelled petroleum exports and government revenues. In addition, Gabon continued to

Estonia Highlights and Key Issues GDP rose #.#% in Q# despite falling industrial output, confirming that modest growth can be maintained this year, helped by temporary deficit spending aimed mainly at infrastructure building. But Eurozone problems are a downside

Country Economic Forecast: ## May #### Czech Republic Highlights and Key Issues GDP fell by a larger than expected #% on the quarter in ####Q# according to initial data released in mid-May. As a result, we now expect GDP

Kazakhstan Highlights and Key Issues Growth continued to slow in April, with the short-term economic indicator up #.#% in the January-April period compared with GDP growth of #.#% in ####. Oil and copper production were notably

Belgium Highlights and Key Issues Belgium s economy surprised most commentators by posting #.#% quarterly growth in Q# this year. But it seems much of this was concentrated in January, as output indicators across all sectors were much weaker

Aruba Highlights and Key Issues Real GDP grew by #.#% in ####, with the strong pace reflecting the re-opening of the oil refinery in ####Q# after an ##-month shutdown. In addition, the underlying growth rate picked up

Algeria Highlights and Key Issues Despite some unrest, Algeria has avoided the political upheaval seen in other parts of the MENA region and the elections held in April passed off calmly. But the elections did not alter the tight grip

Poland Highlights and Key Issues At its May meeting, the Monetary Policy Council (MPC) raised interest rates by ##bp, following a spell of persistently above-target inflation. We view the decision as largely symbolic, aiming to consolidate the central bank

Honduras Highlights and Key Issues GDP in Honduras rose #.#% in ####, up from #.#% growth in the previous year. Although still below the regional average, the pick-up in growth last year is surprising, considering that the

France Highlights and Key Issues France has avoided falling back in recession for now, with GDP unchanged in ####Q#. But investment fell sharply in Q# and is unlikely to recover during the remainder of the year. We forecast #.#

Colombia Highlights and Key Issues President Santos will be mid-way through his four-year term in August and his administration is developing its social policy focus with a housing programme, including a recent plan to extend free homes to

Austria Highlights and Key Issues After stagnating in the previous two quarters, Austria s economy performed slightly better than expected in Q#, with GDP growing by #.#% on the quarter. But recent data and ongoing weak external demand still

## May #### US Weekly Economic Briefing U Greek elections spark speculation of exit from the euro General elections at the beginning of this month led to a fragmented parliament in Greece. The vote shares of the two parties which

## May #### UK Weekly Economic Briefing A Greek exit from the Eurozone ­ what will be the impact? Greece s general elections in early May produced a fragmented parliament with a strong representation of anti-bailout parties. Attempts to form

Country Economic Forecasts: ## May #### Turkey Highlights and Key Issues Although industrial output fell on the quarter in Q#, the continuing boost from net trade is likely to have kept quarterly GDP growth in positive territory. Merchandise export volumes

Portugal Highlights and Key Issues After a brief spell of stability at the start of ####, the Eurozone crisis has escalated once again, triggered by political turmoil in Greece and renewed problems in Spain s banking sector. Portugal is highly

Oman Highlights and Key Issues GDP growth is forecast to slow to #.#% this year from #% in ####, with both oil and the government making lower contributions to growth. Oil output is forecast to rise by just #

Italy Highlights and Key Issues The Italian economy contracted for the third consecutive quarter in ####Q# according to preliminary figures. GDP fell #.#% on the quarter in Q#, slightly worse than expected, after a #.#% decline in ####Q#

Comoros Highlights and Key Issues ####. Economic activity in the Comoros is rising steadily and GDP growth is estimated to have been over #% in ####. This reflects a pick-up in agricultural production, driven by favourable weather conditions, an

## May #### A Greek exit from the Eurozone ­ what will be the impact? Greece s general elections in early May produced a fragmented parliament with a strong representation of anti-bailout parties. Attempts to form a government have failed

Emerging Markets Weekly Economic Briefing Strong rise in FDI flows to emergers in #### but likely to be under some pressure this year Aggregate FDI inflows to the emergers rose to US$###bn in #### from US$###bn in ####

Ukraine Highlights and Key Issues Slowdown to #.#% growth in Q# reflects this year s constraints on industrial exports and domestic investment. But recession should be avoided, with GDP seen rising #.#% this year, and weak demand will

Swaziland Highlights and Key Issues In ####, Swaziland faced a serious fiscal crisis, with a budget deficit of well over ##% of GDP stemming from a sharp drop in SACU customs revenues and the highest public sector wage bill relative

Norway Highlights and Key Issues Strong activity data at the start of the year, in particular as regards consumption, have led us to raise our GDP growth forecast for #### to #.#%. Domestic demand continues to be the main

Macau Highlights and Key Issues Gambling and related tourism continue to drive rapid growth, with the economy expanding ##.#% in ####. Domestic demand remains buoyant, with import volumes rising by over ##% in ####, consumer spending up by ##

Country Economic Forecast: ## May #### Malaysia Highlights and Key Issues #### #### #### #### #### #### Domestic Demand ##.# #.# #.# #.# #.# #.# Private Consumption #.# #.# #.# #

Lesotho Highlights and Key Issues Supported by a surge in global commodity prices, we estimate that growth picked up to nearly #% in ####. Boosted by the rebound in diamond prices and a pick-up in diamond mining, export volume

Kuwait Highlights and Key Issues Kuwait s long-term growth prospects appear increasingly vulnerable. Growth is more dependent than any other GCC country on favourable oil factors and, by association, on rising government spending. A collapse in the oil price

Country Economic Forecast: ## May #### Japan Highlights and Key Issues Japan is likely to have seen solid GDP growth in ####Q# thanks in large part to a rebound in consumer spending, which in turn reflected government stimulus measures. But

UK Country Economic Forecast: ## May #### UK Highlights and Key Issues The preliminary estimate of GDP for ####Q# reported a surprise #.#% contraction on the quarter, the second successive decline. We are treating the data with caution, given

Peru Highlights and Key Issues President Ollanta Humala has been in office for some nine months and his commitment to economic stability and social inclusion is widely backed. Thorny problems are ever- present though, with the regional resurgence of guerrilla

Jamaica Highlights and Key Issues After contracting for three years from ####- ####, the economy grew #.#% in ####, driven by double-digit gains in agriculture, helped by better weather, and mining. Having struggled in recent years, aluminum and

Ghana Highlights and Key Issues After solid GDP growth of #.#% in ####, the start of oil production lifted growth to close to ##% in Q# ####. The pace has slowed since then, but expansion in #### overall was

United States Highlights and Key Issues A number of weaker than expected indicators suggest that the economy is slowing down as it did in H# last year. However, some of the weakness probably reflects a payback from the mild winter

Martinique Highlights and Key Issues The export-dependent economy of Martinique rebounded in ####, as GDP grew #.#% ­ after a drop of #.#% in #### ­ helped by solid rises in consumption and investment. However, we estimate GDP growth

India Highlights and Key Issues In April, the Reserve Bank of India (RBI) cut the key interest rate by a surprisingly large ##bp, justifying its decision on the fall in core inflation this year and the subdued pace of growth

Croatia Highlights and Key Issues The decline in industrial output accelerated in Q# as the new government focused on deficit reduction and structural reform to secure next year s EU accession and reduce the risk of more credit-rating downgrades

Chile Highlights and Key Issues Latest monthly data suggest that the pace of growth in Chile has moderated, though still at quite a high level. We estimate that GDP rose by #.#% on the quarter in Q# #### after

## May #### US Weekly Economic Briefing Despite signs of slowing, there is still cause for optimism Over the past couple of months, a number of economic indicators have been disappointing. There were only ###,### new jobs in April

## May #### UK Weekly Economic Briefing Assessing the health of the banking sector The weak economic environment presents challenges for retail and commercial banks, which will need to contend with a deterioration in the credit quality of their existing

Syria Highlights and Key Issues b There appears little prospect of an end to the anti-Assad uprising that has cost some ##,### lives and seen periods of localised civil war. The UN ceasefire looks to have failed and

Switzerland Highlights and Key Issues The latest indicators on the Swiss economy paint a mixed picture, but perhaps look marginally weaker than previously expected. While the tenor of the latest KOF survey was relatively optimistic, expectations have been dampened by

Eurozone Highlights and Key Issues Concerns about a possible Eurozone break- up have intensified following the outcome of the Greek general elections. Our baseline continues to assume that a break-up is avoided but should Greece decide to leave the

Burundi Highlights and Key Issues In ####, we estimate GDP growth averaged #.#%. Although a pick-up in investment spending, mostly financed by donors, was a key support for growth, rising food and fuel prices weighed on domestic demand

## May #### ## ## ## ## ## ## ## ## #### #### #### #### #### #### #### #### Eurozone: PMIs PMI index Source : Markit Services Manufacturing Break-up fears intensify again Concern about a possible Eurozone break-up has

Emerging Markets Weekly Economic Briefing Emerging middle class to drive global growth Consumers in the G# countries have been the primary source of demand in the global economy for the last ## years, and over the same period the emerging

Venezuela Highlights and Key Issues The government is determined to contain stubbornly high inflation in the run-up to this year s presidential election on # October. Price control officials are placing signs outside stores to inform shoppers whether they

Egypt Highlights and Key Issues The first round of the presidential elections on ##-## May may have narrowed to a two-horse race between veteran diplomat and former head of the Arab league, Amr Moussa, and the leading Islamist

Bulgaria Highlights and Key Issues We have lowered our forecast for Bulgaria and now expect GDP growth to slow to #.#% in #### (from #.#% previously). This revision reflects weaker demand in the Eurozone, the main trading partner

Bolivia Highlights and Key Issues President Evo Morales continues to pursue a radical agenda, most recently including the nationalisation of another foreign-owned utility (Red Electrica of Spain) on # May. He is over halfway through a second term that

Country Economic Forecast: # May #### Taiwan Highlights and Key Issues The flash estimate for Q# indicates that Taiwan s economy has returned to growth, with GDP rising by #.#% on the quarter. But this was much weaker than

Country Economic Forecast: # May #### South Korea Highlights and Key Issues Although the economy grew by a solid #.#% in Q#, with expansion in consumer spending and investment even faster, the strength seems to have been concentrated in

Benin Highlights and Key Issues · Benin s GDP grew #.#% in #### according to the IMF, after severe floods in #### limited growth to #.#%. Reconstruction efforts will continue in #### and generate GDP growth of nearly #

Vanuatu Highlights and Key Issues Vanuatu s GDP is estimated to have grown #.#% last year, up from #% in ####. Growth was driven by construction and agriculture. But the tourist industry declined as arrivals in #### had been

Israel Highlights and Key Issues Growth is slowing from the pace of #.#% seen in the last two years as the recession in Europe, Israel s second largest market and a key source of tourists, weighs on output and

Azerbaijan Highlights and Key Issues GDP growth remained weak in Q#, up just #.#% from a year earlier. Though oil output showed signs of modest recovery, it was still #.#% below the same period in ####. And gas

# May #### US Weekly Economic Briefing Payrolls disappointed again, but underlying improvement is expected to continue The April labor market report was weaker than expected, with only ###,### net jobs created. That marks the second month in a

# May #### UK Weekly Economic Briefing How much should we read into the Q# GDP data? Last week s release of the preliminary estimate of GDP for ####Q# caused quite a stir, with the outturn being significantly weaker than

Nigeria Highlights and Key Issues The Nigerian economy continues to expand strongly, with GDP growth easing only slightly last year to #.#%. The non-oil sector remains the main driver of growth, rising almost #% in ####, led by

Denmark Highlights and Key Issues We continue to forecast GDP growth of #.#% for ####. Recent monthly data, such as rising consumer and industrial confidence, have been broadly in line with our expectations. But the weakness of external demand

Brazil Highlights and Key Issues Latest indicators suggest a mixed performance in Brazil in recent months; official data such as the economic activity index and retail sales contracted on the month in February and industrial production was below that of

# May #### -## -## -## # ## ## ## ## ### #### #### #### #### #### #### #### #### #### #### Credit conditions for loans to businesses % balance Source : Oxford Economics/Haver Analytics Eurozone Tightening Has the LTRO bazooka

Emerging Markets Weekly Economic Briefing Activity relatively subdued currently but growth should accelerate in H# By comparison with the pace of expansion during much of the last two and a half years, the current rate of growth in many leading

Sweden Highlights and Key Issues After a sharp drop in the economy in ####Q#, the signs at the start of #### have been promising so far, particularly with regard to consumer spending. As a result, we have raised our forecast

Libya Highlights and Key Issues Ahead of the elections scheduled for June, the NTC continues to face a huge challenge in uniting the country. Regional and tribal tensions have been building since the overthrow of Colonel Gaddafi and the main

Greece Highlights and Key Issues Despite the private sector debt swap in mid- March, Greek government bonds are still trading at a significant discount to their face value, reflecting continued concerns about the sustainability of Greece s debt. The debt

Country Economic Forecast: # May #### Singapore Highlights and Key Issues Advance estimates show that the economy grew by #.#% on a seasonally adjusted annualised basis in Q#, meaning that recession was avoided after a contraction of #.#

Malta Highlights and Key Issues A slowdown was already under way in Q#, as the financial sector failed to offset a drop in tourist numbers from last year s record, and declining industrial output. These reflect weakness in EU demand

Jordan Highlights and Key Issues Growth accelerated modestly in Q# #### to #.#%, the strongest rise last year, which gave full-year #### growth of #.#%, up from #.#% in ####. This was well below the rates

Country Economic Forecast: # May #### Hungary Highlights and Key Issues In a surprise development, the EC has approved the start of official loan negotiations, which should pave the way for the agreement of a new standby facility with the

Slovakia Highlights and Key Issues Although Slovakian industry has started #### relatively well, the outlook remains bleak. We expect GDP in the Eurozone to contract by #.#% this year, which will mean weak demand for Slovak exports. Subdued external

Country Economic Forecast: # May #### Ireland Highlights and Key Issues Ireland continues to make good progress in implementing economic reforms, with the budget deficit excluding one-off effects down to #.#% of GDP in ####, below the target

Georgia Highlights and Key Issues Unexpectedly strong growth of #% in #### reflected further revival of exports and inward investment, helped by improving relations with Russia. Growth is better balanced than before the recession, but will slow to #-#

Ecuador Highlights and Key Issues GDP data for #### show that annual growth accelerated to #.#% from #.#% in ####, aided by high oil prices and robust local demand. Year-on-year growth in Q# was #.#

Commodity Price Forecasts: April #### Copyright (C) #### Oxford Economics # Commodity Price Forecasts Contents # Contents # # Overview # # Latest Forecasts # #.# Oil Prices # #.# Non-Oil Commodity Price Indices # #.#

Country Economic Forecast: ## April #### South Africa Highlights and Key Issues Domestic spending has made a weak start to the year, with retail sales volumes falling #.#% on the month in February after a #% decline in January

Country Economic Forecast: ## April #### Romania Highlights and Key Issues After an encouraging recovery in #### when GDP grew by #.#%, momentum in Romania seems to be dwindling. Although the economy will continue to grow in ####, we

Mexico Highlights and Key Issues Activity appears to have lost strength in February but not by enough to trigger a revision of our growth forecast for the year at this stage. The seasonally adjusted indicator of economic activity fell #

Iraq Highlights and Key Issues Oil exports have now started to rise more strongly, with the start-up of a second new floating oil terminal boosting capacity at Iraq s southern ports. As a result, output rose to over #m

Hong Kong Highlights and Key Issues The March PMI business survey data remained in expansionary territory for the third consecutive month, suggesting modest economic growth. But the index did fall back from the previous month s figure. And the ####

Country Economic Forecast: ## April #### Czech Republic Highlights and Key Issues The Czech economy contracted by #.#% in ####Q# and is expected to shrink further in H# this year as the manufacturing sector is hit by the weakness

## April #### US Weekly Economic Briefing Old-age entitlements are in trouble From time to time over the past decade, we have commented in these reports that the programs that support the income and health care of the elderly

## April #### UK Weekly Economic Briefing The aggregate mortgage repossessions outlook As in the ####s mortgage crisis, the ####-# upturn in the possessions rate was preceded by lower lending quality and rising debt and house price levels, accompanied

Country Economic Forecast: ## April #### Thailand Highlights and Key Issues The economy is now recovering strongly from last year s severe flooding and the assistant governor of the Bank of Thailand said recently that "the recovery is in a

Country Economic Forecast: ## April #### Netherlands Highlights and Key Issues The outlook for the Netherlands is shrouded in uncertainty after Prime Minister Mark Rutte tendered his resignation on ## April. His government had been unable to agree on the

Cyprus Highlights and Key Issues Banking sector problems, weak tourism from the EU and the need for sharp public sector cutbacks rule out any return to growth this year; indeed, a return to recession is now expected. Banks are struggling

Bahrain Highlights and Key Issues Political risk in Bahrain remains high, with protests continuing almost daily and threatening to become more violent. Despite implementation of various reforms, progress in addressing Shia concerns ­ namely unemployment, poverty, discrimination and democratic representation ­ remains

## April #### France ­ fiscal and economic realism is needed The economic environment has dominated the French presidential election campaign. Both candidates have pledged to return public finances to balance ­ Sarkozy by #### and Hollande by ####. But the growth

Emerging Markets Weekly Economic Briefing Latin America ­ still resilient to the mounting global headwinds, but Argentine policy moves worrying Despite the continuing global headwinds, Latin American economies remain broadly resilient and are unlikely to feature among the countries that may

Zambia Highlights and Key Issues Zambia s change of government after free and fair elections last September proceeded smoothly by African standards. The populist President Sata (aged ##) and his Patriotic Front are fighting corruption (and settling some political scores

Spain Highlights and Key Issues The Spanish government has recently announced a tough package of fiscal austerity measures in its budget for ####. But implementing these reforms will prove very difficult in what remains of the year. And with the

Colombia Highlights and Key Issues Colombia s economy is benefiting from high world energy prices and rising investment, which in turn are helping to bolster GDP growth. After rising #% in ####, GDP grew even faster in ####, by #

Canada Highlights and Key Issues GDP grew by #.#% in ####, underpinned by a #.#% rise in domestic demand. But we expect the latter to slow this year, reflecting a negative contribution from the government sector and a

Russia Highlights and Key Issues High frequency data for Q# continue to point to a dual-speed economy. While the industrial sector is still struggling with a fairly muted external environment, service sector activity has been fairly buoyant, underpinned by

Morocco Highlights and Key Issues GDP grew #.#% on the year in Q#, resulting in full-year #### growth of #.#%, up from #.#% in #### and a little stronger than had been expected. Expansion in Q#

Kazakhstan Highlights and Key Issues Economic data for Q# confirm that the pace of economic activity has slowed, with mining output down #.#%, construction down #.#% and a sharp #.#% drop in agricultural output. Manufacturing, trade and

Australia Highlights and Key Issues The release of very subdued inflation data for the first quarter of #### has reignited speculation about further rate cuts by the Reserve Bank of Australia (RBA). The good recent inflation performance has been helped