Tellimer Research
4 Dec 2023
Fixed income strategy: Top picks for 2024
Our Top 5 picks for 2024 are Buys on Cote d’Ivoire, Tajikistan, Ukraine GDP warrants, Suriname, and Uganda local. Seven other trades to watch, or themes, for the year ahead: Argentina, Bahamas, Venezuela, LatAm RV trades, and themes.. ...restructurin...
Tellimer Research
1 Dec 2023
Ethiopia: Debt suspension signals restructuring momentum; upgrade to Buy
Ethiopia reached a deal with its official creditors to suspend debt service payments through the end of 2024. Suspension could pave the way for IMF programme and is aimed at buying time to agree a more comprehensive restructuring. After selling off s...
Tellimer Research
28 Nov 2023
Fixed income strategy: 2024 outlook – pick your battles
Commencement of Fed cutting cycle should support EM assets but with risk that path is more hawkish than markets expect. Frontiers remain vulnerable but default wave is unlikely; risks from China slowdown, busy election cycle and geopolitics. BBB and...
Tellimer Research
24 Nov 2023
Fixed income strategy: 2023 in review – annus slightly less horribilis
Higher global rates have made it a tough year for fixed income although EM may eke out a positive annual return. Recent easing in financing conditions and expectations of a soft landing help EM bonds finish on a stronger note. No sovereign bond defau...
Tellimer Research
21 Nov 2023
Zambia: OCC rejection of Zambia's restructuring deal sets a dangerous precedent
Zambia and bondholders agreed on a revised restructuring that complies with IMF targets after first was deemed deficient. Despite offering higher NPV relief relative to the OCC, the OCC has rejected the deal as out of line with CoT principles. We thi...
Tellimer Data
15 Nov 2023
Premium
External Liquidity Index: Q4 2023 update
We update our External Liquidity Index for 65 emerging and frontier markets to flag those most at risk of default. Most vulnerable (excl. those in default) are Ethiopia, Mozambique, Bolivia, Pakistan, Mongolia, Kenya, Tunisia & Egypt. Least vulnerabl...
Tellimer Data
15 Nov 2023
Premium
Debt Sustainability Index: Q4 2023 update
We update our Debt Sustainability Index for 71 emerging and frontier markets to flag those most at risk of default. Most vulnerable (excl. those in default) are Jamaica, Pakistan, Angola, Benin, Mozambique, Jordan, Bahrain, Egypt & Laos. Least vulner...
Tellimer Research
15 Nov 2023
EM funding drought requires tough policy choices and weighs on growth prospects
Over 1/3 of the EM index is locked out of the market and 'higher for longer' reality means this is likely to persist. A lack of alternative funding sources means governments must 'right size' twin deficits to levels that can be financed. This require...
Tellimer Research
11 Nov 2023
Rising debt vulnerabilities
The IMF estimates that 50% of low-income countries are in debt distress or at high risk. Vulnerabilities are less severe than they were in the pre-HIPC period but change is required reverse the negative trend. Egypt, Pakistan, Kenya and to a lesser e...
Tellimer Research
10 Nov 2023
Mongolia: External improvements persist but durability is questionable
The external risks we flagged after April’s IMF Spring Meetings have yet to materialise. Booming coal exports to China have pushed current account into surplus and bolstered reserves. Uncertainties remain on durability of external improvement, while...
Tellimer Research
9 Nov 2023
Iraq: Policy missteps offset oil boom
Iraq has benefitted from rising oil prices, pushing reserves up sharply over the past year. However, currency revaluation and expansionary fiscal policy have placed economy on wrong path. Risk of near-term crisis is nonetheless low given robust reser...
Tellimer Research
7 Nov 2023
Diverging reform paths in Turkey and Nigeria
Turkey and Nigeria's reform trajectories have diverged in recent months. Investors left Marrakech more confident in Turkey's delivery of gradual policy normalisation plans. Meanwhile, Nigeria’s reform efforts had stalled at the time of the meetings b...
Tellimer Research
3 Nov 2023
South Africa MTBPS: Fiscal slippage but not as bad as expected
Wednesday's MTBPS widens FY 23/24 budget proj. from 4% to 4.9% due to revenue shortfalls, but lower than 5.3% consensus. Increased spending on wages, grants and debt service offset by cuts elsewhere, and NT takes hard line on SOE transfers. Overall t...
Tellimer Research
3 Nov 2023
Unpacking recent debt restructuring developments
Debt restructuring was a dominant theme at the IMF/WB Annual Meetings. Notable progress has been seen in Zambia and Sri Lanka, with signs of progress in Ethiopia and no progress in Lebanon. State-contingent debt instruments seemingly becoming the nor...
Tellimer Research
31 Oct 2023
Zambia: Restructuring agreement points to some upside for recovery value
Agreement in principal reached with bondholder Steering Committee includes 18% cut to claim and notable cashflow relief. Includes two bonds, one of which sees higher coupons and accelerated amortization schedule if Upside Case is triggered. Upside to...
Tellimer Research
30 Oct 2023
IMF/WB Annual Meetings, October 2023 – country notes and global themes
We cover 19 countries in this note following the IMF/WB Annual Meetings, and highlight some global themes. Specifically, here we cover Angola, Bahamas, Ecuador, Egypt, Ethiopia, Iraq, Kenya, Lebanon, Mongolia, Mozambique. ...Nigeria, Pakistan, Senega...
Tellimer Research
19 Oct 2023
Sri Lanka rejects bondholder proposal & bondholders propose PDI Bond
We analysed bondholder proposal yesterday and saw risks as balanced, prompting us to downgrade from Buy to Hold. Bondholders have since proposed new "PDI Bond", which adds some upside to yesterday's recovery value estimates. However, government has r...
Tellimer Research
18 Oct 2023
Sri Lanka: Downgrade to Hold on Chinese deal and private proposal
Restructuring deal with China Exim Bank took other creditors by surprise; not yet clear if news is positive or negative. Bondholder proposal for innovative Macro-Linked Bond points to more upside and more downside than previously thought. Downgrade '...
Tellimer Research
9 Oct 2023
Rwanda at a crossroads
We met with the IMF's Mission Chief for Rwanda last week and summarise our key takeaways. Reform implementation has been strong but buffers have been eroded and shifting financing backdrop poses challenges. Rwanda now looks appropriately priced on a...
Tellimer Research
5 Oct 2023
Egypt: Ministry of Finance investor presentation
We met with the Investor Relations team from Egypt's Ministry of Finance yesterday. The meeting was off the record but we provide the accompanying investor presentation. Presentation affirms our previous recommendation to Buy Egypt '48s.
Tellimer Research
4 Oct 2023
Uganda: Positive macro outlook despite fiscal and external risks
Discussion with the IMF's Uganda Mission Chief and Resident Representative paints positive macro picture for Uganda. Still, risks are tilted to the downside, with suspension of World Bank funding and spending slippages as key concerns. Meeting bolste...
Tellimer Research
29 Sep 2023
Sri Lanka: IMF review delayed by revenue shortfalls and financing assurances
The IMF completed its two-week mission to Sri Lanka from 14-27 September without the first review being completed. Reasons cited are revenue shortfalls and need to obtain financing assurances from official creditors (incl. China). Issues were expecte...
Tellimer Research
27 Sep 2023
Kenya: Restructuring concerns and fiscal slippage weigh on bonds
Mixed messages over Kenya's US$2bn June 2024 rollover plans and President Ruto's restructuring marks trigger uncertainty. Interest-driven 1% of GDP widening of FY 23/24 deficit and evidence of revenue shortfalls point to rising fiscal risk. Kenyan eu...
Tellimer Research
25 Sep 2023
Nigeria: Naira collapse signals crisis of confidence
NGN has reached nearly 1,000/US$ in the parallel market amid FX shortages, bringing the parallel premium to c30%. Decisive monetary tightening and FX float are needed but leadership vacuum at the CBN has hampered policy response. Chance for pivot whe...
Tellimer Research
21 Sep 2023
Turkey's normalisation process continues with 500bps rate hike
The CBRT hiked its policy rate by 500bps to 30%, in line with expectations, brining cumulative hikes to 21.5% since May. Unwinding FX-protected deposits accounts is the next, and more difficult, stage of the normalisation process. Especially given hi...
Senior Economist
@
Tellimer Research
Patrick focuses on emerging market macro/sovereign research. Prior to joining Tellimer, he worked at Eaton Vance in Boston conducting sovereign fixed income analysis and spent time at the South African Reserve Bank in Pretoria. He holds an MA in International Economics at the Johns Hopkins School of Advanced International Studies in Washington and is a CFA charterholder.
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