The surprise decision by the British electorate to vote to leave the EU has resulted in a surge of uncertainty for the global outlook. In the wake of the UK’s referendum the pound sterling hit its lowest level against the US dollar for more than 30 years, while financial stocks in Europe and some market indices around the world crashed, highlighting the global effects. We anticipate that extreme volatility in capital markets will abate after a short period but keep returning, punctuated by periods of lower volatility, for months, as markets will be driven mainly by political cues in a process with no obvious roadmap.
Among the questions that will have to be faced are: To what extent will a ‘flight to safety’ away from the UK pound (and other EU currencies) occur? To what extent will this strengthen the US dollar, the Japanese yen and the price of gold? Will the prices of commodities such as oil weaken as the dollar strengthens? There is also the general question of global liquidity: will we see a return to the illiquid markets of 2008? How rapidly markets return to pre-Brexit volatility levels will to an extent be determined by the reactions of the main central bankers globally, but also by politicians, and politics, in the UK and rest of the EU.
This complimentary newsletter from D&B’s Country Insight Services group has been put together by their team of experts using the most up-to-date information to provide a snapshot of the latest macro market risk situation, and provides an excellent overview for those exposed to cross-border credit or investment risks.
WORLD SNAPSHOT ASIA PACIFIC AMERICAS
Mozambique: The country’s liquidity crisis reflects low commodity prices and escalating debt.
South Africa: The country faces recession as the economy contracts, dragged down by extractive industry performance.
Iraq: Dun & Bradstreet upgrades its rating outlook for Iraq on account of improving fiscal prospects.
Syria: The international community eyes greater co-operation to resolve the conflict.
Ireland: Brexit is set to negatively affect the short-term economic outlook.
Netherlands: Dun & Bradstreet downgrades its rating outlook for the Netherlands due to increased uncertainty in the EU.
Bulgaria: Growth will be dragged down by Brexit’s impact on key trading partners and sentiment.
Romania: Brexit poses risks to the economy and to the EU.
Australia: Political uncertainty declines somewhat as the government secures a majority in the lower house of parliament.
New Zealand: The country’s deteriorating logistics ranking puts pressure on the overall risk picture.
Brazil: The growth forecast improves slightly, but we still expect a recession.
Cuba: Government revenue falls due to lower oil and nickel prices.
D&B Country Insight Services
D&B’s Country RiskLine reports above are written by a team of highly skilled analysts in D&B’s Country Insight Services team using exclusive data from its global network of reporting offices as well as primary and secondary data from national and international sources.
These snapshot reports provide a succinct assessment of the risk of doing business in a country, given its economic, political and commercial situation.
Updated monthly, the data and analysis are presented in a standard format which helps you monitor and evaluate the business trading conditions in a foreign country and facilitates the management of ongoing business risk around the globe.
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Designed with the help of our customers these reports build on the key areas assessed by ‚D&B’s Country Insight Model‘ and deliver a perfect balance between mitigating risk exposure and providing insight into new opportunities.
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veröffentlicht am: 01. Juli 2016