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Daily Intelligence Briefing August 12, 2014
Ukraine’s currency has been a reliable real-time indicator of regional tensions. Back in February, the hryvnia plunged sharply as Russia’s “little green men” took control of Crimea and Moscow reneged on a loan package made to the prior president who had just fled Kiev. The currency stabilized after the US and EU stepped in with their own loan guarantees.
In April, the currency plunged again as pro-Russian separatists took control of wide swathes of the eastern province, with the apparent participation of Russian operatives and a massive build-up of Russian troops just across the border. The currency stabilized with another funding package put together by the IMF. Now the currency is in free fall again as tensions rise. Nato’s secretary general says there’s a “high probability” of an attack and Ukraine has increased its estimates of Russian troops along the border. Russia is sending 300 trucks on a humanitarian aid mission to eastern Ukraine, although a suspicious Ukraine is threatening to block the convoys. As these events unfold, Ukraine’s currency continues to fall despite repeated interventions by its central bank.
Today’s Issue Cluster: Ukraine
- Russia’s food ban includes non-EU’s Norwegian fish … a boon for Chile’s fish farms
- The EU is holding talks with South American countries about sanctions-busting … Brazil is already opening 90 new meat plants
- Russia says it can offset US/EU sanctions on oil and fracking technology with Asian equipment … analysts are downgrading oil forecasts anyway
- Russia’s working age population will be decimated in the next decade
- Russia’s stock market has been trading at discount to the MSCI Emerging Markets Index for the last decade
- Ukraine’s hyrvnia is at an all-time low: repeated central bank intervention has been less effectual than possible Russian intervention
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EU – OECD Indicators Point to Slowdown in Germany
EU – Election exposes deep divisions in Sweden
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