Fiscal policy

Fiscal policy latest publications

August 15, 2019

Mexico needs a counter-cyclical fiscal policy; a fiscal council would help

Considering the current circumstances of almost zero economic growth, there is no need to aim for a primary surplus similar to the one planned for this year (1% of GDP) in 2020. If properly reported, a smaller primary surplus may be welcomed by the markets.

July 23, 2019

Spain | Uncertainty around fiscal policy in the 2019-20 period

Budget implementation in April 2019 slightly worsens the dynamics of 2018. During the 2019-2020 period, and in no policy change scenario, the pace of adjustment of the public deficit would be moderating compared to that observed in previous years

June 27, 2019

Seismic waves in global trade

Recent weeks have seen an escalation of restrictive measures and trade retaliation between the US and China, as well as restrictions placed on the activity and investment of foreign technology companies in domestic markets or the announcement of further tariffs imposed by the US to Mexico.

June 4, 2019

Fiscal policy in Mexico: a challenge to be addressed

Mexico is facing important fiscal challenges. On the one hand, its tax collection is very low: tax revenue as a share of the GDP (only 14%) is not only the lowest in the OECD, but it is also low when compared to other Latin American economies.

June 3, 2019

Portugal: orthodoxy, certainty and reward

A couple of years ago, the risk premium paid by the Portuguese 10-year government bond against its German counterpart was hovering between 350 and 400 basis points (bp). Meanwhile, the Spanish 10-year bond was paying between 100 and 125 bp.

May 17, 2019

Spain | Uncertainty around fiscal policy in the 2019-20 period

The first budget execution data for 2019 slightly worsens last year's dynamics. In an environment of extended budget and policy uncertainty, the economic cycle will reduce the deficit, although the current fiscal targets will be missed.

April 25, 2019

Peru Economic Outlook. Second quarter 2019

Activity slowed at the beginning of the year due to the decline in public investment and mining production. Going forward, there will be a better performance .We continue foreseeing GDP will grow by 3.9% in 2019 supported by mining investment. However, in comparison with the previous report, now our forecast has a downward …

April 12, 2019

Mexico | Positive signs in fiscal policy

Mexico’s Ministry of Finance and Public Credit (SHCP) has recently issued indications that I view as positive and that have been well received by the markets. The most important of these concerns the recently announced preliminary criteria for economic policy.