20171206-法国巴黎银行-EM_TODAY_7页_234kb

EM STRATEGY DAILY SUMMARY - 06 December 2017

Core Content Overview

This document is a daily summary from BNP Paribas Emerging Markets Strategy team, providing insights and market outlooks for various regions including Brazil, India, CEEMEA, and Turkey. It also includes legal disclaimers and regulatory disclosures relevant to the jurisdictions where the document is distributed.

Key Market Insights

Brazil

• Central Bank (BCB) Policy Outlook: The BCB is widely expected to cut policy rates by 50 basis points (bps) in its final monetary policy decision of the year.
• Market Expectations: The DI curve already reflects this rate cut, but the focus will be on the BCB's next steps and the likelihood of further rate cuts in 2018.
• Strategy Update: The team has extended the target for the Jan19 receiver recommendation to below 7.00%, assuming continued rate cuts and a flattening of the DIs curve, especially in the short end.

India

• RBI Policy Outlook: The Reserve Bank of India (RBI) is expected to keep rates unchanged in its policy meeting.
• Economic Context: India's GDP growth accelerated in Q3 2017, and inflation has increased after hitting a low in June. If this trend continues, the RBI may initiate a rate-hike cycle in the second half of 2018.

CEEMEA

• GCC Summit: No breakthrough was achieved at the latest GCC summit, with tensions between Qatar and its neighbors continuing.
• MSCI Concerns: MSCI has not moved to use offshore FX rates immediately for Qatar, but will monitor the accessibility of the Qatari FX market. There are concerns that the MSCI might stop using onshore FX rates due to increasing spreads between offshore and local FX rates.

Turkey

• CBRT Inflation Note: The central bank remains cautious about inflationary pressures, suggesting it may tighten monetary policy at its next MPC meeting on 14 December.
• TRY Performance: The TRY has stabilized recently, likely due to rising market expectations of rate hikes. However, 1-month returns have turned positive but remain low, while 3-month returns are at -12%, indicating a bearish trend that may not reverse smoothly.

Poland

• NBP Policy: The National Bank of Poland kept rates on hold at 1.5%, as widely expected.
• Governor's Message: The Governor, Glapinski, expressed a dovish stance, indicating potential rate stability until the end of 2018.
• FRA Curve: The FRA curve currently prices in 50bps of rate hikes in the second half of 2018.
• PLN Strength: The strength of the PLN has helped contain inflation, reducing the need for near-term tightening.

Strategy Contacts

Market Movements

• Global Equities: Weaker this morning.
• US Curve: Continues to flatten.
• Asia FX: Broadly unchanged, with the exception of KRW, which weakened by 0.7% against the dollar.

Legal and Regulatory Disclaimers

• This document is non-independent research and may be subject to conflicts of interest.
• It is a marketing communication and not investment research.
• It does not constitute an offer to sell or issue securities, nor a solicitation to buy.
• No liability is accepted for any loss arising from reliance on the document.
• BNP Paribas may engage in transactions inconsistent with the views expressed.
• The document is subject to change and may be discontinued.
• It does not constitute a prospectus and is not intended for retail investors.
• Certain securities may be restricted and only available to Qualified Institutional Buyers or non-US persons.

Jurisdictional Disclosures

• United States: Disclosures regarding options, ETFs, and unregistered securities are included.
• UK: Document is communicated by BNP Paribas London Branch.
• France: Report is produced and distributed by BNP Paribas SA and/or BNP Paribas Arbitrage.
• Germany: Distributed by BNP Paribas S.A. Niederlassung Deutschland.
• Belgium: Distributed by BNP Paribas Fortis SA/NV.
• Ireland: Distributed by BNP Paribas S.A., Dublin Branch.
• Italy: Distributed by BNP Paribas Italian Branch.
• Netherlands: Distributed by BNP Paribas Fortis SA/NV, Netherlands Branch.
• Portugal: Distributed by BNP Paribas - Sucursal em Portugal.
• Spain: Distributed by BNP Paribas S.A., S.E.
• Switzerland: Intended solely for Qualified Investors.

Disclaimer Summary

• No Liability: No liability is accepted for any direct or consequential loss.
• Confidentiality: Information is provided on a confidential basis.
• Indicative Pricing: Any indicative prices are based on internal models and may vary significantly from other sources.
• No Investment Advice: No advice or fiduciary duty is provided.
• Past Performance: Not indicative of future performance.
• Regulatory Compliance: The document complies with relevant regulations in each jurisdiction.