• Risk iStock_000016809464SmallJordan – political stability and recovering economic growth;
  • Morocco – the Kingdom needs every bit of foreign capital inflow it can get;
  • New Zealand – interest rates will soon start to rise;
  • Panama – thanks to a compromise, Canal work has resumed;
  • Taiwan – better than first estimated.

ARGENTINA:  The government has a new inflation index, but is sticking with its “unconventional” approach to fighting price increases, a policy that will become less & less effective and ultimately lead to yet another crisis.

INDIA:  The rupee will remain acutely vulnerable on the downside, even though the latest current-account BoP numbers show a marked improvement. CB efforts to get inflation down will stay gradual. There is a risk in the prospective further taper by the US Fed. And the elections could produce an unstable government.

KENYA: The country will continue to show sub-par growth, but its newfound macroeconomic stability is noteworthy. The political arena is troubled in that both President Kenyatta and Vice President Ruto face charges at the ICC.  More of a problem, though, is that the al-Shabaab terrorists have yet to be decisively defeated.

RUSSIA: The ruble and the local stock market have taken a beating in the wake of Russia’s invasion of the Crimea Peninsula, but to jump from there to the conclusion that the time has come for a red alert on the Russian economy would be premature. Russia is still running external surpluses and reserves are substantial.

SAUDI ARABIA: President Obama is about to visit Riyadh in an attempt to mend badly frayed ties between the Kingdom and the United States. His progress is likely to be limited, but business relations between the two countries are apt to remain good. Restrictive social rules are being relaxed only very slowly.

SINGAPORE: Economic growth has slowed, but there is not going to be a recession. Nor is the reported housing bubble a real threat. The country is at the mid-point of a ten-year economic transition and is making reasonably safe progress.

TURKEY: The lira has stabilized, at least temporarily. While its debasement has serious consequences for many companies in Turkey, the country has been able to resume its borrowing abroad. The return of confidence could be fleeting, though. The country’s difficulties are chipping at the support for PM Erdogan and he is responding by lashing out in all directions.

UKRAINE:  Efforts to get Ukraine and Russia to begin direct negotiations are going nowhere and it is highly unlikely that the Kremlin will back off in any decisive way.  Pres. Putin wants Ukraine as part of his resurrection of Greater Russia, and if he cannot have all of it he will take part. The Ukrainian economy, meanwhile, is sliding fast.

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