MENA | Saudi-UAE agreement, Covid-19 restrictions
Amid deadlock within OPEC+, speculation is rising that Saudi Arabia and the UAE have reached a compromise over production quotas, after the UAE opposed an extension of the group’s cooperation deal beyond the current end date of April 2022.
What you will learn:
- Oman and Bahrain announced additional Covid-19 related restrictions to cover the Eid al-Adha period, with fears that large gatherings that are typical over the holidays could fuel a surge in cases. Elsewhere, Qatar is opening up to vaccinated tourists as it ramps up preparation for the 2022 World Cup.
- Turkey’s central bank kept its policy interest rate on hold at 19.0% after inflation hit 17.5% in June, its highest in over two years, fuelled by a boost to consumer spending from the relaxation of restrictions compounded by vulnerability to rising commodity prices and a weak currency. A rate cut is unlikely before Q4.
- Following the collapse of OPEC+ talks and tensions between Saudi Arabia and the UAE over production cuts, there is speculation that the two countries have reached a compromise.
BoK’s monetary policy to tighten even as hiking cycle ends
Even without rate hikes, central banks' monetary policies can effectively tighten if the nominal neutral rate falls below the policy rate. We expect this will be the case for the Bank of Korea this year, as the gap between the policy rate and the nominal neutral rate widens.Find Out More
China: Emerging green shoots in Spring, but not out of the woods
We now incorporate a faster recovery from the post-Covid exit wave and raise our 2023 full-year GDP growth forecast to 4.5% (from 4.2% previously).Find Out More