J.P. Marín-Arrese | Kevin McCarthy’s failed attempts to snatch election as Congress Speaker not only signals a severe divide within the Republican party. It may also hamper the ability to run the country. Rebels aim to block the White House agenda, even launch an impeachment against Biden, and seem ready to put the US Government in default by refusing to increase the debt ceiling next October. They will likely question…
Alicia García Herrero * (Natixis) | It is hard to imagine a more momentous meeting than the one Presidents Joe Biden and Xi Jinping just held on the sidelines of the Group of Twenty meeting in Bali. Russian President Vladimir Putin’s absence certainly made things easier, as it opened the door for the G20 communiqué to address the Ukraine war, but it is not going to go beyond a compromise…
Fernando González Urbaneja | We are learning in these uncertain times that it is all bulls up to the tail, that the electoral results are those that are certified by the bodies in charge of controlling the votes. And that often takes time. In Brazil, the electronic system made it possible to verify Lula’s victory on election night itself, albeit by a very small margin, but enough to avoid any…
Matt Christensen (Allianz GI) | The COP27 climate summit takes place in Egypt in November, providing a check-in on global progress towards net zero in a year dominated by economic and geopolitical pressures. There are reasons to be optimistic. • The focus of this year’s COP27 is on “delivery” after an eventful year that has also revealed the flaws in our existing energy mix• The financial sector will be in…
Former president Luiz Inácio Lula da Silva won the second round of the presidential elections in Brazil on Sunday with 50.84% of the votes, compared to 49.16% for the current president, Jair Bolsonaro, with 99.10% of the ballot boxes counted. The leader of the Workers’ Party (PT), who governed between 2003 and 2010, will once again occupy the presidency of an extremely divided Brazil from 1 January 2023 and for…
Allianz GI | The market reaction to the conclusion of China’s Party Congress is telling. The Hang Seng China Enterprises Index (a gauge of key China stocks listed in Hong Kong) fell more than 7% on the first day of trading after the Congress. The CSI 300 (onshore China’s equivalent of the S&P 500) as well as the broader Shanghai and Shenzhen stock exchanges saw a far more muted reaction.1…
IFO Insitute | The assessment of the political situation improved worldwide in the second quarter of 2022 according to the latest Economic Experts Survey (EES) – a global quarterly survey conducted by the IFO Institute and the Swiss Economic Policy Institute – which this time had 1,795 participants from 127 countries. At plus 10 points, they assessed political stability worldwide as significantly better than in the previous quarter. “Despite energy…
Crédito y Caución (Atradius) | In his second term, President Joko Widodo has continued to tackle economic reforms, such as infrastructure improvement to support the manufacturing sector and digital economy, reforms of the labour market and foreign investment rules. However, some key elements of his policy agenda remain contested due to vested interests. While Widodo has broad support in the House of Representatives, the wide range of political groups in…
Alicia García Herrero (Natixis) | US President Joe Biden’s long-awaited trip to Asia got off to a poor start, after ASEAN leaders’ official visit to the White House saw hardly any relevant policy decisions, and Biden’s stingy pitch of $150 million to ASEAN economies. Based on that example and Biden’s difficult political situation at home, the stakes for his trip to Asia were low. But reality has proved the pessimism…
J.P. Marín-Arrese | Biden needs to bolster his tarnished presidency before the upcoming elections. Failing to deliver his electoral promises for the less well off, he faces the grim prospect of losing control of the Chambers. His economic record seems appallingly lacklustre as inflation is eroding incomes of most American households. Moderate Democrats allied themselves with Republicans to dump bombastic plans to provide widespread social benefits. Growth and jobs are…