Mexico sold $4 billion in long-term sovereign global bonds yesterday, becoming the fourth developing-country government to tap the international bond market this week. The Mexican government issued $1 billion in 7-year bonds to yield 120 basis points (bps) over comparable U.S. Treasuries and $3 billion in 30-year bonds to yield 170 bps higher than Treasuries. Developing-country sovereign bond sales have been on a record pace this month, with Sri Lanka, Indonesia, the Philippines, and Mexico raising $10.5 billion combined this week. Furthermore, overall developing-country bond sales (including both corporate and sovereign issues) since the start of the year more than doubled from year-ago levels.
Developing Economies…East Asia and Pacific: China’s export growth slowed markedly in December, advancing 4.3% (y/y) compared with November’s growth of 12.7%. Meanwhile imports accelerated to an annual growth of 8.3%, faster than November’s 5.3% increase. As a result, the trade surplus shrank to US$25.6bn in December, down from US$33.8bn in November. For the full year of 2013, exports grew 7.9%, imports rose 7.3%, and the trade surplus amounted to US$259.75bn.
Europe and Central Asia: Bulgaria’s industrial production increased for the third consecutive month in November, rising by a working-day adjusted 2.8% (y/y), after a gain of 3.6% in October. Contributing to the November gain, manufacturing production increased 4.7% (y/y) and mining and quarrying rose 28.4% (y/y); while production of electricity, gas, steam and air conditioning fell 11.4% (y/y).
Latin America and the Caribbean: Brazil’s annual headline inflation, measured by the consumer price index, accelerated in December, rising to 5.91% from 5.77% in November, approaching the government’s target ceiling of 6.5% for 2014. Contributing to this increase, prices of food and beverages rose 8.48% (y/y), housing costs increased 3.4% (y/y), prices of clothing and footwear climbed 5.38% (y/y) and transportation cost rose 3.29% (y/y). Month-on-month, prices rose 0.92% in December, faster than the 0.54% increase recorded in November.
South Asia: India’s industrial production continued to decline in November, falling 2.1% y/y) after decreasing 1.8% (y/y) in October. Driving the November decline, manufacturing output fell 3.5% (y/y), partially offset by a 1% (y/y) increase in mining production. Electricity production rose 6.3% (y/y).
Separately India’s exports rose 3.49% (y/y) in December, less than the consensus forecast of a 7% gain. Meanwhile, imports fell 15.25% (y/y), slightly more than the expected 15% decline. As a result, the trade deficit fell to US$10.1bn (y/y) in December from US$17.59bn a year ago.