Inflation rattles emerging markets finance; government support slips for petro state banks

Gersan Zurita of the Credit Strategy and Research team and Semyon Isakov of the Banking team discuss rising inflation in some key emerging markets. Plus, Felipe Carvallo and Mik Kabeya of the Banking team talk about slipping government support for banks in economies that are heavily dependent on oil.

Inside this episode:

• Felipe Carvallo and Mik Kabeya of the Banking team talk about slipping government support for banks in economies that are heavily dependent on oil. (begins at 2:04)
• Gersan Zurita of the Credit Strategy and Research team and Semyon Isakov of the Banking team discuss rising inflation in some key emerging markets. (begins at 6:48)

Related content:

• Banking System Outlook Update – Mexico: Negative outlook on prolonged recovery and deteriorating government support - We maintain our negative outlook for the Mexican banking system in line with our expectation that less predictable policy response will weigh on economic recovery and government support.
• Banking System Outlook Update - Saudi Arabia: Negative outlook reflects asset quality pressure and weakening government support - Our outlook for the Saudi banking system is negative. The outlook reflects our view of how the banks' creditworthiness will evolve over the next 12 to 18 months.
• Banks – Russia: Climbing inflation will boost large bank dominance amid structural shift in funding - Rising inflation has turned real yields on deposits negative, hastening the movement of savings out of term deposits, which will boost large banks dominance.
• Macroeconomics – Latin America: Pace of inflation quickens but long-term implications will depend on any sustained acceleration - Basic commodity prices have risen by 50% on average over the last 12 months across Latin America, with differing drivers and effects by country.