EM EMEA Flash – EM GDP Nowcast Model – February 2024

  • Feb 12, 2024

EHSAN KHOMAN
Head of Commodities, ESG and
Emerging Markets Research –
EMEA
DIFC Branch – Dubai
T:+971 (4)387 5033
E: ehsan.khoman@ae.mufg.jp


RAMYA RS
Analyst
DIFC Branch – Dubai
T:+971 (4)387 5031
E: ramya.rs@ae.mufg.jp

 


MUFG Bank, Ltd.
A member of MUFG, a global financial group

MUFG’s EM GDP Nowcast Model 

  • Emerging markets (EM) nowcast modelling framework that we launched last year (see here) estimates EM real GDP growth (seasonally adjusted annual rate) in Q1 2024 at 4.4% y/y (consensus 3.8%).
  • The regional breakdown of our estimates points to 4.7%, 2.2% and 0.7%, for EM Asia, EM EMEA, and LatAm, respectively.
  • Throughout 2023, EM have had to navigate the “triple whammy” of higher US interest rates, a strong US dollar and slower Chinese growth, and have weathered this storm with resilience and remarkably have even managed to eke out narrow sleeves of outperformance.
  • Heading into 2024, EM growth is set to stabilise as domestic fundamentals offset external drags, with some rotation from largest to smaller EMs. Inflation and policy rates are both “over the hump” – disinflation is progressing, and the decline in rates will continue and broaden in 2024. (see here)