• The attack on Russian ambassador in Turkey and a probable terrorist attack in Berlin may trigger a risk off mood among global investors. The correction should not be too deep and too long.
• We do not expect any reaction in the Russian market to the EU sanctions extension.
• Changes in Chinese banking regulation may hurt the demand for local sovereign and corporate bonds which may trigger the market correction.
• We consider that Fortescue Metals Eurobond due in 2022 is a good trading opportunity given the issue is rated BBB- by two rating agencies and provides a 4% p.a. till a call date in March 2018, which is one of the best yield for investment grade bonds.
• Higher expectations for the Japan economic growth in 2017 may limit further stimulus from the BOJ, which may be negatively assessed by investors.
• Brazilian economic team decreased its growth forecasts for 2017.
• Expectations are growing that the Chilean Central Bank will implement monetary easing to support growth and inflation.
• We do not expect Mexico’s Central Bank to increase key rate as current level is sufficient to stabilize MXN.
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