Foreign Exchange Consensus Forecasts by Consensus Economics Inc.

Survey DateDecember 10, 2012

Every month, Foreign Exchange Consensus Forecasts surveys more than 250 financial and economicforecasters for their currency exchange rate projections. The results covering over 90 currencies –together with reference data and analysis of factors such as inflation, interest rates, balance of payments,government policies and politics – are rushed to subscribers by express mail and e-mail.

Currency Risk Assessments – A Special Survey

In order to gauge the risks of more significant swings in exchangerates than the consensus is currently predicting, we asked our pan-ellists to assign probabilities to a range of possible outcomes. Theresults, some of which show asymmetries of risk, are set out onpages 34 and 35.

OverviewPolitical events continue to take centre stage in the US, Europeand Japan and their uncertainties have led to shifts in the US dollar(page 3), the euro (page 4) and the Japanese yen (page 6). Theoutcome of upcoming debt negotiations, elections and policies onausterity, inflation and reforms will have a significant impact onhigh-yielding assets in 2013, as happened in 2012. Indeed, if theyear to date represented an accurate guide for full year perform-ance, the Argentinean peso (page 16) and the Brazilian real (page17) were particularly sensitive to financial volatility and reoccurringspikes in risk aversion. Each lost just over 10% of its value, as theglobal slowdown hurt exports and saw their economies pressuredby anaemic growth. Yet, despite having faced similar difficulties,the Mexican peso (page 21) rose 9.3% over the same period, as itbenefited from an upturn in investor confidence. Inflation in theeconomy is under control, its banking sector is seen as relativelywell capitalised and elections in July produced a more pro-busi-

(continued on page 2)

FOREIGN EXCHANGE CONSENSUS FORECASTS®

E-mail Edition: - © Consensus Economics Inc. All rights reserved. Under our agreement this publication may notbe reproduced (complete or partial), redistributed, stored in a public retrieval system or broadcastto persons other than the email subscriber without the prior written permission of ConsensusEconomics Inc.

ContentsPage

Overview .......................................... 1

Currencies in the Spotlight this Month

United States .......................................... 3Euro zone ............................................... 4Japan ...................................................... 6Canada ................................................... 8Thailand ................................................ 10Hungary ................................................ 12Chile ..................................................... 14

Major Currencies

Argentina, Australia, Brazil, Canada . 16-17Chile, China, Colombia .......................... 18Czech Republic, Denmark, Hong Kong. 19Hungary, India, Indonesia ..................... 20Israel, Malaysia, Mexico ....................... 21New Zealand, Norway, Peru .................. 22Philippines, Poland, Romania ................ 23Russia, Singapore, South Africa ........... 24South Korea, Sweden, Switzerland ....... 25Taiwan, Thailand, Turkey ...................... 26Ukraine, United Kingdom, Venezuela .... 27

PageAdditional Currencies

Albania, Algeria, Angola, Azerbaijan, Bahrain, Bangladesh, Belarus, Bolivia, Botswana,Bulgaria, Costa Rica, Croatia, Dominican Republic, Ecuador, .............................................................................28Egypt, El Salvador, Georgia, Ghana, Guatemala, Guyana, Haiti, Honduras, Iceland, Iran,Ivory Coast, Jamaica, Jordan, Kazakhstan, ........................................................................................................29Kenya, Kuwait, Laos, Latvia, Lebanon, Libya, Lithuania, Malawi, Morocco, Myanmar (Burma),Nicaragua, Nigeria, Oman, Pakistan, ..................................................................................................................30Paraguay, Saudi Arabia, Serbia, Sri Lanka, Sudan, Syria, Tanzania, Tunisia, UAE, Uganda,Uruguay, Vietnam, Yemen, Zambia ....................................................................................................................31

Long-Term Forecasts ....................................................................................................................... 32Cross Rates ....................................................................................................................................... 33Currency Risk Assessments – A Special Survey .......................................................................... 34Graph of Currency Forecasts .......................................................................................................... 36

Editor: Che-Wing PangAssistant Editor: David M. BakerWeb: www.consensuseconomics.com

Foreign Exchange Consensus Forecasts (ISSN: 1351-0983) is published by Consensus Economics Inc.,53 Upper Brook Street, London, W1K 2LT, United KingdomPublisher: Philip M. Hubbard Tel: (44) 20 7491 3211 Fax: (44) 20 7409 2331

© Copyright Consensus Economics Inc. 2012. All rights reserved. The contents of this publication, either in whole or in part, may not be reproduced, stored or transmitted in any form or by any means,electronic, photocopying, digitization or otherwise without the prior written permission of the publisher. The Editor and Consensus Economics Inc., do not guarantee or take any responsibility for theinformation set forth herein, including the accuracy, completeness or timeliness of the forecasts or written analysis.

DECEMBER 20122

© Copyright Consensus Economics Inc. 2012

OVERVIEW

Forecast

% change Spot Rate Consensus Forecasts % change

See Since End Dec. 10 End Jan. End Mar. End Dec. to End

Page Dec. 2011 2012 2013 2013 2013 Dec. 2013

Summary: Foreign Exchange Consensus Forecasts

❒ ECB - European Central Bank e - consensus estimateGDP - Gross Domestic Product IMF - International Monetary FundM/S&P - Moody's and Standard & Poor's sovereign debt ratings na - not availablePPP - Purchasing Power Parity, see top of page 4 m-o-m - month-on-monthq-o-q - quarter-on-quarter y-o-y - year-on-year

❒ GDP is expressed in real (i.e. inflation-adjusted) terms. GDP and consumer prices are expressed as average percentagechanges over the previous year unless otherwise indicated. Measures of trade, current account and foreign exchangereserves (which exclude gold) are expresed as nominal amounts in US dollars (billion).

❒ Interpolated rates on pages 5-27 are calculated as period average or end period forecasts based on simplestraight-line interpolations from consensus forecasts.

❒ All individual foreign exchange forecasts on pages 5-15 are listed in descending order of their 1 year percentchange estimates. Consensus forecasts are averages of the named forecasters shown plus Other Forecasters.

DECEMBER 2012NOTES AND ABBREVIATIONS

Currency units per US$ orEuro, except the UK£, A$and Euro which are the

reciprocals.

(continued from front page)

Exchange rates vs. US$Australian Dollar (US$/A$) 17

Brazilian Real 17

Canadian Dollar 8

Chinese Renminbi 18

Euro (US$/€) 4

Indian Rupee 20

Japanese Yen 6

Mexican Peso 21

Russian Rouble 24

South Korean Won 25

Turkish Lira 26

UK Pound (US$/UK£) 27

Exchange rates vs. EuroCzech Koruna 19

Hungarian Forint 12

Norwegian Krone 22

Polish Zloty 23

Swedish Krona 25

Swiss Franc 25

3.4 1.050 1.034 1.023 1.000 -4.7

-10.6 2.080 2.078 2.077 2.057 1.1

3.4 0.987 0.988 0.989 0.985 0.2

1.1 6.235 6.254 6.249 6.158 1.2

-0.1 1.293 1.286 1.276 1.258 -2.7

-2.3 54.52 53.71 53.51 52.71 3.4

-5.6 82.34 81.33 81.79 83.49 -1.4

9.3 12.79 12.79 12.78 12.58 1.7

4.8 30.73 31.20 30.95 31.28 -1.8

6.7 1079 1084 1080 1050 2.85.8 1.790 1.793 1.794 1.801 -0.6

4.0 1.608 1.597 1.588 1.578 -1.8

2.1 25.27 25.36 25.50 25.07 0.8

10.0 283.2 284.5 285.5 284.3 -0.4

5.6 7.339 7.329 7.322 7.235 1.4

7.6 4.108 4.140 4.153 4.066 1.0

2.9 8.659 8.542 8.546 8.400 3.1

0.9 1.207 1.207 1.212 1.223 -1.3

ness government, which has underpinned the outlook for re-forms. The Chilean peso (featured in this month’s spotlighton page 14) is another currency in Latin America that hasachieved a near double-digit advance. It, too, is not immuneto swings in investor sentiment, although it has been wellsupported by internal demand and a resilient economy, whichexpanded 5.7% (y-o-y) in Q3. Furthermore, unlike some ofthe other countries in the region, its policymakers had re-frained from FX intervention to undermine the currency formuch of the year. Ironically, the Hungarian forint (page 12)has exceeded expectations as well, despite its weak eco-nomic performance and fragile fundamentals. Yet its advancecame mainly in the first seven months of 2012 and the inabil-

ity of the government to finalise a deal for financial aid fromthe IMF (partly due to its controversial bank tax plan) has ledto relatively wide swings since. In Asia, regional competitiveissues will remain a key theme in 2013, as countries jostlefor exports to a slowing group of Western economies. TheSingapore dollar (page 24) and the South Korean won (page25) have both risen by almost 7.0% in the year to date, com-pared with only 1.1% for the Chinese renminbi (page 18)and a decline of 5.6% for the Japanese yen (page 6), follow-ing its recent sharp correction.

In the spotlight this month we also feature the Canadiandollar (page 8) and the Thai baht (page 10).

DECEMBER 20123


78.0

79.0

80.0

81.0

82.0

83.0

84.0

85.0

Jul 2 12 Aug 9 12 Sep 18 12 Oct 26 12 Dec 5 12

DIRECTION OF TRADE

2011 % ofEXPORTS TO: US$bn TotalCanada 280.8 19.0Mexico 197.5 13.3China 103.9 7.0Japan 66.2 4.5United Kingdom 56.0 3.8Other 776.4 52.4

TOTAL: 1480.7 100.0

IMPORTS FROM:China 417.4 18.4Canada 320.7 14.2Mexico 265.4 11.7Japan 132.4 5.8Germany 100.4 4.4Other 1028.7 45.4

TOTAL: 2265.0 100.0

US Interest Rates(Treasury bill and bond forecasts also on page 4)

UNITED STATES DOLLAR

The US$ is the principal benchmark currency against which the values of othercurrencies (except most Europeans) are measured throughout this publication. (For cross ratesand forecasts against the yen and euro see page 33.) The only exchange-traded index of theUS dollar's value is the NYBOT (composition below), which was originated by the Federal Reservein the early 1970s. Futures based on its ‘cash’ index (DXY) are traded on the New York CottonExchange. From the direction of trade statistics (below right) it will be noted that Canada has agreater weight in US trade than in the NYBOT index, while Mexico is not represented; the principalEuropean countries have a greater weight in the index than in US trade.

US$ INDEX: Monthly(Based on the NYBOT index weights below)

US: Risk Indicators%

Economic Indicators and Consensus Forecasts

US$ INDEX: Daily High, Low, Closing(Based on the NYBOT index weights above)

% of GDPConsensusForecasts

INDEX WEIGHTINGSEuro 57.6%Japanese yen 13.6%British pound 11.9%Canadian dollar 9.1%Swedish krona 4.2%Swiss franc 3.6%

Current AccountBalance

(% of GDP)

70.0

80.0

90.0

100.0

110.0

120.0

130.0

Jan 92 Jan 94 Jan 96 Jan 98 Jan 00 Jan 02 Jan 04 Jan 06 Jan 08 Jan 10 Jan 12

0.0

2.0

4.0

6.0

8.0


Long Term Rates - 10 Yr Treasury Bonds

Fiscal Cliff in FocusThe US dollar continues to move undera shadow of fiscal policy uncertainty,amid a deadlock in negotiations betweenthe White House and Congress to averta crisis before December 31. Each sideis aware of the profound implications animpasse for the dynamics of the Ameri-can economy in 2013. And investor sen-timent could deteriorate quickly in theevent of a stalemate, as happened dur-ing the debt ceiling fiasco in Q3 2011.Yet the Democrats and the Republicanswill have difficulty reaching compromisefrom entrenched positions. Most observ-ers expect the US Federal Reserve toannounce additional monetary stimuluson December 12, in order to keep Treas-ury rates anchored and to protect therecovery from potential fiscal issues. Un-certainties caused by ongoing politicalparalysis have caused our panel to lowerits GDP forecast for next year to below2.0%, from 2.2% in 2012. The medium-term debt outlook for US, though, maynot be as dire as some commentatorsfear. Shale gas production should beginto scale up, bringing with it compara-tive advantages for US industry and po-tential reductions in the trade and cur-rent account deficits.

-11.0

-9.0

-7.0

-5.0

-3.0

-1.0

1.0

3.0

'92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

* Calculated from actual andweighted consensus

currency forecasts fromlatest survey.

Budget Balance(% of GDP)

Debt Ratings(M/S&P): Aaa/AA+

Fed Funds Forecasts(Latest = 0 to 0.25%)

End Dec.2012

End Mar.2013

End Jun.2013

End Sep.2013

Mode (most frequent f’cast)

Short-Term Rates - 3m Treasury Bills

FX Reserves(% of GDP)

0.125% 0.125% 0.125% 0.125%

* *

Consensus (mean average) 0.140% 0.141% 0.141% 0.142%

Nominal GDP (2011): US$15094bn GDP per Capita: US$48,208 ConsensusPopulation (mid-2011): 313.1mn Forecasts

Real GDP, %Consumer Prices, %Current Account, US$bnShort Term Interest Rates1

FX Reserves, end yr, US$bn1 3 mth treasury bills (%), end period. Forecasts for 3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013-0.3 -3.1 2.4 1.8 2.2 1.93.8 -0.3 1.6 3.1 2.1 2.0

-677.1 -381.9 -442.0 -465.9 -476.8 -454.60.1 0.1 0.2 0.0 0.1 0.1

46.6 50.5 52.1 51.9 na na

Actual ----- Consensus ----- Dec. 10 End Mar. 2013 End Dec. 2013

US$ Index* 80.37 81.07 82.07

1 1

DECEMBER 20124


-4

-2

0

2

4

6

8

10


Long Term Rate Differential*

Short Term Rate

Differential*

0.8

0.9

1.0

1.1

1.2

1.3

1.4

1.5

1.6

1.7

J an 92 J an 94 J an 96 Jan 98 J an 00 J an 02 J an 04 J an 06 Jan 08 J an 10 J an 12

PPP Estim ate

US$/Eu ro (s ynthetic euro pr ior to J an. '99)

Austrian schilling 13.7603Belgian/Lux. franc 40.3399Cypriot pound 0.58527Deutschemark 1.95583Estonian Kroon 15.6466Finnish markka 5.94573French franc 6.55957Greek drachma 340.750Irish punt 0.78756Italian lira 1936.27Maltese lira 0.42930Netherlands guilder 2.20371Portuguese escudo 200.482Slovakian koruna 30.1260Slovenian tolar 239.640Spanish peseta 166.386

EURO

US$ per Euro: Actual and Purchasing Power Parity Estimates

Euro zone Less US Interest Rate Differentials

The Purchasing Power Parity (PPP) theory asserts that, over the long-term, the trend ofan exchange rate is determined by cumulative differences in the national inflation ratesof the two countries concerned. We have estimated a long-term PPP trend by relatingthe average real exchange rate (1992-2011) to indices of producer price inflation in theUS and the euro zone over the same period. Figures for the euro prior to January 1999are 'synthetic' i.e. they have been calculated using a basket of the eleven originalmember currencies. The PPP line represents an approximation of the euro's long-runvalue, and a currency may be considered over- or under-valued if it is more than 10%above or below the PPP estimate. Our latest PPP estimate is US$1.25 per euro.

European Currency Union: The euro replaced indi-vidual currencies of the eleven original members inJanuary 1999. Greece adopted the euro at the start of2001, followed by Slovenia in 2007, Cyprus and Maltain 2008 and Slovakia in 2009. Estonia joined in Janu-ary 2011. The fixed exchange rates of euro membercountries are shown on the right.

Central Bank: The European Central Bank (ECB) isresponsible for monetary policy, which is set by acommittee drawn from EMU-members' central banks.Policy is carried out by a six-member executive board,currently headed by the Italian ECB president Mr.Mario Draghi (appointed in November 2011).

Fixed Conversions per Euro

Average % change

* Euro rates are synthetic prior to Jan. '99. 3mth Euribor and German 10-year bond yields thereafter.

%Euro and US$ Interest Rates

ConsensusForecasts

Swings in Euro SentimentAs has been the case for much of theyear, mid-to-late November support forthe euro lacked conviction. Efforts tocontain the debt crisis remain fragile andwere undermined by a lack of economicstrength. Greece secured the nexttranche of its rescue package from theEU and IMF late last month, drawing aline under immediate fears of a currencyunion exit. In addition, euro zone financeministers approved an aid deal for Span-ish banks, taking the heat off Madrid torequest a full-blown bailout. Yet boththese countries are heavily in recession(bottom box) and any sense of jubila-tion at their recent successes has beencurtailed by news of a possible storm inRome. Mario Monti became leader of atechnocrat Italian government in 2011,tasked with fixing the public finances andrestoring growth. However, he an-nounced his intention to stand down lastweek, after being unable to win crossparty support for broad reforms. Doubtsabout the commitment of the next ad-ministration to deficit reduction are re-flected in a renewed rise in Italian bondyields. The European Central Bank keptrates at 0.75% in early December, buthas hinted at more monetary easing inthe New Year in response to the spreadof economic and political uncertainty. Inan environment in which the peripheraleuro zone members are stuck in fiscalstraitjackets and the outlook for growthis dim, the euro will continue to be vul-nerable to periodic bouts of volatility.

Background Data (2011)

GDP Population GDP per(US$bn) (mn) Capita ($)

Consumer Price InflationConsensusForecasts

GDP Growth

* Forecasts from latest Consensus Forecasts – G-7 & Western Europe euro zone survey.

Average % change

(Libor)

(T-bill)1.5% 1.8%

1.8% 2.3%

(Continued on page 5)

(German)

Actual ---- Consensus -----Dec. 10 End Mar. 2013 End Dec. 2013

Euro: 3-mth 0.2%Euro: 10-yr 1.3%US$: 3-mth 0.1%US$: 10-yr 1.6%

0.2% 0.3%

0.1%0.1%

2008 2009 2010 2011 2012 20131.1 -5.1 4.2 3.0 0.8 0.7

-0.2 -3.1 1.6 1.7 0.1 0.1-1.2 -5.5 1.8 0.6 -2.2 -0.91.4 -3.8 2.1 2.7 0.5 0.71.0 -2.7 2.4 1.8 -0.2 0.20.3 -8.5 3.3 2.7 0.2 0.73.1 1.4 -2.8 -6.1 -6.5 -4.5

-2.1 -5.5 -0.8 1.4 0.2 1.01.8 -3.7 1.6 1.1 -0.9 -0.20.0 -2.9 1.4 -1.7 -3.1 -2.30.9 -3.7 -0.3 0.4 -1.4 -1.6

0.3 -4.3 1.9 1.5 -0.5 -0.1

GermanyFranceItalyAustriaBelgiumFinlandGreeceIrelandNetherlandsPortugalSpain

Euro zone*

2008 2009 2010 2011 2012 20132.6 0.4 1.1 2.3 2.0 1.92.8 0.1 1.5 2.1 2.0 1.63.3 0.8 1.5 2.8 3.1 2.03.2 0.5 1.9 3.3 2.4 2.24.5 -0.1 2.2 3.5 2.8 2.04.1 0.0 1.2 3.5 3.0 2.54.2 1.2 4.7 3.3 1.2 0.14.1 -4.5 -1.0 2.6 1.8 1.22.5 1.2 1.3 2.3 2.5 2.32.6 -0.8 1.4 3.6 2.8 1.44.1 -0.3 1.8 3.2 2.5 2.3

3.3 0.3 1.6 2.7 2.5 1.9

3,569 82.2 43,4342,774 63.1 43,9362,197 60.8 36,147

417 8.4 49,620513 10.8 47,712266 5.4 49,498299 11.4 26,251218 4.5 48,013840 16.7 50,394238 10.7 22,236

1,492 46.5 32,110

13,097 332.0 39,448

Recent Economic Outturns (y-o-y)

GDPUSA 2.0% 2.4% 2.1% 2.5%Euro zone 0.6% -0.1% -0.5% -0.6%Germany 1.9% 1.2% 1.0% 0.9%

CPIUSA 3.3% 2.8% 1.9% 1.7%Euro zone 2.9% 2.7% 2.5% 2.5%Germany 2.3% 2.2% 1.9% 1.9%

Average Producer Price InflationEuro zone (2002-2011) = 2.39%US (2002-2011) = 2.82%

Q4 2011 Q1 2012 Q2 Q3

Q4 2011 Q1 2012 Q2 Q3

DECEMBER 20125


EURO

Interpolated RatesUS$ per Euro

Quarter EndAverage Quarter

On the second Monday of everymonth we ask our panel to forecastspot rates for the US$ against the euroover a range of time horizons. The Con-sensus is the mean of all the forecastsreceived, including Other Forecasterspolled whose names do not appear.FECF then calculates the annual per-cent change and the discount (-) orpremium (+) of the consensus fore-cast to the survey date spot rate. Thequarter average and end quarter fig-ures shown below are based on a sim-ple straight line interpolation of con-sensus forecasts.

THE CONSENSUSSURVEY DATE SPOT

US$ per Euro: Daily High, Low, ClosingUS$ perEuro

%

US$bn

Yen per EuroYen/Euro Cross Rate

FORECASTS: US$ PER EURO

Currency Linkages: Independent float.The ECB aims to keep inflation ‘below butclose to 2%’ over the medium term.

Trading and Hedging Markets: The eurois the second largest forex market currencyafter the US$. US$/€ futures and options onfutures are traded on the Chicago Mercan-tile Exchange.

1.20

1.22

1.24

1.26

1.28

1.30

1.32

1.34


-0.05

0.00

0.05

0.10

0.15

0.20

0.25

0.30

ConsensusForecasts

* Excludes intra euro zone member transactions, ECB defintion.

94

96

98

100

102

104

106

108

J ul 2 12 A ug 9 12 S ep 18 12 Oc t 26 12 Dec 5 12

Current Account Balances Country Risk Indicators

(% of GDP) (% of GDP) (% of GDP) (Moody’s/S&P)Current Account Budget Balance Public Debt

SovereignDebt Ratings

Yen/Euroforecasts on

page 33.

RATE (Dec. 10, 2012) 1 Euro = US$ 1.293

GermanyFranceItalyAustriaBelgiumFinlandGreeceIrelandNetherlandsPortugalSpain

Euro zone*

2008 2009 2010 2011 2012 2013225.0 195.3 199.6 204.6 212.9 206.8-49.4 -34.9 -40.0 -54.1 -52.6 -45.1-65.8 -41.9 -72.4 -67.3 -29.5 -16.320.2 10.4 12.9 2.4 5.1 7.0-6.7 -6.7 9.0 -7.3 -3.0 -0.67.1 4.2 3.6 -4.2 -3.5 -3.0

-51.0 -35.9 -29.8 -28.7 -13.6 -9.5-14.9 -5.2 2.4 2.5 4.6 5.137.3 41.2 59.8 81.5 63.7 57.9

-31.8 -25.6 -22.8 -15.4 -5.8 -3.2-153.3 -70.2 -62.8 -52.1 -25.5 2.6

-206.9 -18.4 4.1 17.3 93.3 126.2

2012 2013 2012 2013 20115.9 5.6 -0.2 -0.3 81.2

-1.9 -1.6 -4.2 -3.2 85.8-1.3 -0.7 -2.5 -1.9 120.11.2 1.6 - - 72.2

-0.6 -0.1 - - 98.0-1.3 -1.1 - - 48.6-4.5 -3.3 - - 165.31.9 2.1 - - 108.27.6 6.8 -3.5 -2.9 65.2

-2.5 -1.4 - - 107.8-1.7 0.2 -6.8 -4.8 68.5

0.7 1.0 -3.1 -2.5 87.2

Aaa/AAAAa1/AA+

Baa2/BBB+Aaa/AA+Aa3/AA

Aaa/AAAC/SD

Ba1/BBB+Aaa/AAABa3/BB

Baa3/BBB-

na

2012 Q4 1.292 1.2902013 Q1 1.284 1.276

Q2 1.273 1.270Q3 1.267 1.264Q4 1.261 1.258

2014 Q1 1.257 1.257Q2 1.257 1.256Q3 1.256 1.256Q4 1.255 1.255

End Jan. End Mar. End Dec. % change End Dec.2013 2013 2013 from spot 2014

Goldman Sachs 1.278 1.250 1.400 8.3 1.400HSBC 1.357 1.370 1.400 8.3 naJP Morgan 1.280 1.280 1.340 3.6 naGeneral Motors 1.274 1.290 1.281 -0.9 1.325IHS Global Insight 1.313 1.320 1.260 -2.6 1.270Allianz 1.250 1.230 1.250 -3.3 1.300BNP Paribas 1.270 1.263 1.250 -3.3 1.250Oxford Economics 1.280 1.280 1.250 -3.3 1.186Credit Suisse 1.265 1.246 1.249 -3.4 1.236Commerzbank 1.297 1.290 1.230 -4.9 naRoyal Bank of Canada 1.307 1.280 1.220 -5.6 naBank of Tokyo Mitsubishi 1.300 1.280 1.200 -7.2 naCitigroup 1.240 1.230 1.200 -7.2 naING Financial Markets 1.250 1.200 1.200 -7.2 1.270Morgan Stanley 1.314 1.340 1.200 -7.2 naUBS 1.300 1.250 1.200 -7.2 1.150Societe Generale 1.270 1.270 1.190 -8.0 1.190Royal Bank of Scotland 1.260 1.230 1.180 -8.7 naABN Amro 1.270 1.250 1.150 -11.1 na

Other Forecasters (75) 1.287 1.278 1.261 -2.4 1.255

CONSENSUS (Mean) 1.286 1.276 1.258 -2.7 1.255

Dec. Discount/Premium on Spot -0.5 -1.3 -2.7 -2.9Nov. Discount/Premium on Spot 1.3 0.4 -1.5 -1.5Oct Discount/Premium on Spot -1.4 -2.2 -4.5 -3.6

Dec. High 1.360 1.370 1.400 1.440Dec. Low 1.191 1.140 1.084 1.041Dec. Standard Deviation 0.031 0.040 0.065 0.076

US$ Less Euro 3 Month InterestRate Futures Differential, March

2012 contracts(right scale - inverted)

DECEMBER 20126


JAPAN: GDP Growth and Inflation(year-on-year)

JAPANESE YEN

YEN per US$: Actual and Purchasing Power Parity Estimates

JAPAN: Risk Indicators(% of GDP)

JAPANESE Less US Interest Rate Differentials%

%

The Purchasing Power Parity (PPP) theory of exchange rates asserts that, over thelong term, the trend of an exchange rate is determined by cumulative differences inthe inflation rates of the two countries concerned. In the above chart we have estimateda long term PPP trend by relating the real average exchange rate (1992-2011) toindices of producer price inflation in the US and Japan over the same period. The PPPline above represents an approximation of the yen's long run value, and a currencymay be considered over- or under-valued if it is more than 10% above or below thePPP estimate. On December 10, the Japanese yen was 3.1% above its recentlyestimated PPP of ¥79.8 per US$.

% of GDP

DIRECTION OF TRADE

2011 % ofEXPORTS TO: US$bn TotalChina 149.6 18.1USA 127.8 15.5South Korea 66.0 8.0Hong Kong 42.9 5.2Thailand 37.5 4.5Other 400.7 48.6

TOTAL: 824.5 100.0

IMPORTS FROM:China 183.8 21.5USA 76.0 8.9Australia 56.5 6.6Saudi Arabia 50.5 5.9UAE 42.9 5.0Other 444.2 52.0

TOTAL: 854.0 100.0

ConsensusForecasts

75

85

95

105

115

125

135

145Jan 92 Jan 94 Jan 96 Jan 98 Jan 00 Jan 02 Jan 04 Jan 06 Jan 08 Jan 10 Jan 12

PPP Estimate

Yen/US$

-6.5

-5.5-4.5

-3.5

-2.5-1.5

-0.5

0.51.5

2.5


Long-Term Rate Differential

Short-Term Rate Differential

-15

-10

-5

0

5

10

15

20

25

30

'92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

Yen SelloffThe yen lost 3.4% of its value betweenend-October and our December survey,as political uncertainty and concernsabout the independence of the Bank ofJapan (BoJ) took hold. Prime MinisterYoshihiko Noda had to call snap elec-tions (December 16) in return for parlia-mentary approval of a crucial deficit fi-nancing bill. And the leader of the mainopposition party who is likely to succeedhim has polarised opinion with his viewson foreign and monetary policies. In acontroversial campaign, he has adopteda tough stance towards a territorial dis-pute with China. In addition, his pledgefor ‘unlimited easing’ to end deflation isseen as extreme and unrealistic. Pres-sure on the BoJ to raise its target forinflation to above 1% and slash rates tozero (or below it, as in the case of Swit-zerland) is also not conducive to inde-pendence. Its current governor, MasaakiShirakawa, is viewed as an inflation-hawk who has resisted political demandsfor stimulus measures that might becounterproductive in the long-term. Yethe is due to retire in April 2013 and maybe replaced by someone more closelyaligned with the demands of the nextadministration. Add a stagnant economyto the mix (recent weak GDP outturns inthird box, left) and it is unsurprising thatthe yen has tumbled to a six month low.It is too early to tell whether politicalrhetoric will actually translate into policyaction, given the vested interests of adivided government. However, FX senti-ment has clearly deteriorated, with re-ports of an increase in short positionson the currency. In all, the consensus ispredicting that the yen will depreciate1.4% over the next 3-12 months.

Current AccountBalance(% of GDP)

Budget Balance(% of GDP)

FX Reserves(% of GDP)

(T-bill)

-7.0

-5.0

-3.0

-1.0

1.0

3.0

5.0

'92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

CPI Inflation

Real GDP Growth ConsensusForecasts

Recent GDP Outturns

y-o-y 0.0% 3.3% 4.0% 0.5%q-o-q 0.1% 1.4% 0.0% -0.9%

3 Mth Actual 10 Yr Actual(Dec. 10) (Dec. 10)

Japan 0.3% 0.7%US 0.1% 1.6%

Average Producer Price InflationJapan (2002-2011) = 0.35%US (2002-2011) = 2.82%

Q4 2011 Q1 2012 Q2 Q3

DECEMBER 20127


JAPANESE YEN

Yen/Euro Cross Rate

FORECASTS: YEN PER US$

Interpolated RatesYen per US$


On the second Monday of everymonth we ask our panel to forecastspot rates for the yen against the US$over a range of time horizons. The Con-sensus is the mean of all the forecastsreceived, including Other Forecasterspolled whose names do not appear.FECF then calculates the annual per-cent change and the discount (-) or pre-mium (+) of the consensus forecast tothe survey date spot rate. The quarterand annual average figures shown be-low are based on a simple straight lineinterpolation of consensus forecasts.

THE CONSENSUSSURVEY DATE SPOT

JAPANESE YEN per US$: Daily High, Low, ClosingYen per US$

Currency Unit: The currency is the yen (¥),which is divided into 100 sen.Central Bank: The Bank of Japan (BoJ) is re-sponsible for setting monetary policy. Mr.Masaaki Shirakawa was appointed as Gover-nor for a five year term in April 2008.Currency Linkages: The yen is an independ-ent floating currency, although the BoJ will in-tervene in consultation with the Ministry of Fi-nance in periods of disorderly market condi-tions or rapid FX change.Trading Markets: The yen is the third largestforex market currency after the US$ and theeuro, with unrestricted trading in spot and for-ward markets.Hedging Markets: ¥/US$ and ¥/euro futuresand options on futures traded on the ChicagoMercantile Exchange. ¥/US$ and ¥/euro optionsare offered by international commercial banks.Government: The Democratic Party of Japan(DJP) scored a landslide victory in the end-August 2009 parliamentary elections, winning308 out of the 480 seats. Yoshihiko Noda re-placed Naoto Kan as prime minister in lateAugust 2011. The DJP remains the largestpolitical party but lost its majority in the upperhouse in July 2010. Next parliamentary elec-tions on December 16, 2012.Debt ratings: Moody’s Aa3

Standard & Poor’s: AA-

Yen perEuro

77.0

78.0

79.0

80.0

81.0

82.0

83.0

84.0Jul 2 12 Aug 9 12 Sep 18 12 Oct 26 12 Dec 5 12

94

96

98

100

102

104

106

108


Economic Indicators and Consensus ForecastsNominal GDP (2011): US$5,869.4bn (¥468.4tn)Population (mid-2011): 126.5mn GDP per Capita: US$46,398

Yen/Euroforecasts on

page 33.

RATE (Dec. 10, 2012): US$1 = ¥ 82.34

2012 Q4 80.74 82.002013 Q1 81.60 81.79

Q2 82.07 82.36Q3 82.64 82.93Q4 83.21 83.49

2014 Q1 83.74 83.99Q2 84.23 84.48Q3 84.73 84.97Q4 85.22 85.47

ConsensusForecasts

Real GDP, %Consumer Prices, %Current Account, US$bnYen/US$, annual averageShort Term Interest Rates1

FX Reserves, end yr, US$bn1 3 mth yen TIBOR (%), end period. Forecasts for 3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013-1.1 -5.5 4.7 -0.5 1.8 0.61.4 -1.3 -0.7 -0.3 0.0 -0.2

161.2 146.8 203.8 119.7 62.6 65.8103.4 93.6 87.8 79.81 79.67 82.38

0.7 0.5 0.3 0.3 0.3 0.31004 997.0 1036 1221 na na

1 1


Royal Bank of Canada 76.33 75.00 70.00 17.6 naHSBC 77.34 76.00 74.00 11.3 naBNP Paribas 78.00 76.67 75.00 9.8 85.00IHS Global Insight 78.25 78.38 77.75 5.9 75.01JP Morgan 79.00 79.00 79.00 4.2 naCredit Suisse 83.41 83.98 79.87 3.1 80.25Goldman Sachs 81.59 80.00 80.00 2.9 80.00Citigroup 84.00 84.00 84.12 -2.1 naGeneral Motors 82.00 82.90 84.35 -2.4 88.29Bank of Tokyo Mitsubishi 81.50 82.50 85.00 -3.1 naING Financial Markets 82.00 82.00 85.00 -3.1 90.00UBS 80.00 85.00 85.00 -3.1 90.00Societe Generale 82.00 82.00 87.00 -5.4 90.00ABN Amro 81.00 82.00 88.00 -6.4 naAllianz 83.00 84.00 90.00 -8.5 90.00Morgan Stanley 82.72 84.00 90.00 -8.5 naOxford Economics 82.70 82.70 90.00 -8.5 94.84Commerzbank 84.00 84.00 92.00 -10.5 naRoyal Bank of Scotland 85.00 88.00 92.00 -10.5 na

Other Forecasters (75) 81.36 81.83 83.53 -1.4 85.33

CONSENSUS (Mean) 81.33 81.79 83.49 -1.4 85.47

Dec. Discount/Premium on Spot 1.2 0.7 -1.4 -3.7Nov. Discount/Premium on Spot 0.0 -0.8 -3.0 -6.1Oct. Discount/Premium on Spot -0.7 -1.4 -4.2 -6.8


DECEMBER 20128


-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

6.0


Long Term Rates

Short Term Rates

CANADIAN DOLLAR

Commodity Prices and the C$

CANADIAN Less US Interest Rate Differentials%

CANADA: Current Account and FX Reserves

DIRECTION OF TRADE

2011 % ofEXPORTS TO: US$bn TotalUSA 333.6 73.7United Kingdom 19.0 4.2China 17.0 3.7Japan 10.8 2.4Mexico 5.5 1.2Netherlands 4.9 1.1Other 61.8 13.7

TOTAL: 452.4 100.0

IMPORTS FROM:USA 223.3 49.5China 48.6 10.8Mexico 24.8 5.5Japan 14.3 2.9Germany 12.9 2.9United Kingdom 10.5 2.3Other 117.5 26.1

TOTAL: 451.9 100.0

(US$bn)

2005 = 100 C$/US$

ConsensusForecasts

The Purchasing Power Parity (PPP) theory asserts that, over the long-term, the trendof an exchange rate is determined by cumulative differences in the national inflationrates of the two countries concerned. In the above chart we have estimated a longterm PPP trend by relating the average exchange rate (1992-2011) to indices ofproducer price inflation in the two countries over the same period. The PPP linerepresents an approximation of the Canadian dollar's correct long-run valuation, anda currency may be considered over- or under-valued if it is more than 10% above orbelow the PPP estimate. On December 10, the Canadian dollar was OVERVALUEDby 11%, compared with its recently estimated PPP of C$1.1 per US$.

C$ per US$: Actual and Purchasing Power Parity Estimates External HeadwindsThe C$ moved to a six-week high of0.99/US$ on December 10, havingtraded in a tight range close to parity formuch of November. Real GDP growthalmost stalled in Q3, registering a 0.1%(q-o-q) increase, with September's read-ing (measured by industry) coming in flatafter a 0.1% contraction in August. Thesluggish Q3 figure came on the back ofa decline in merchandise exports and a0.6% drop in business investment, itsfirst fall since Q2 2009. Household con-sumption, though, held up well and rose0.9%. In the current quarter, the manu-facturing PMI dropped from 51.4 in Oc-tober to 50.4 in November, suggestinganother soft performance. Quarterly es-timates from our sister publication, (Con-sensus Forecasts – G-7 & Western Eu-rope) indicate that Q3 represented atrough in the business cycle and thatoutput would begin to pick up by themiddle of next year. However, growth willdepend to an extent on events south ofthe border (page 3), as more than 70%of exports are destined to the US. TheBank of Canada held rates at 1.0% onDecember 4, even though inflation wasonly 1.2% (y-o-y) in each of the pastthree months. A reluctance to ease mon-etary policy is partly due to concernsabout household debt and asset bubbles.A small but positive rate differential withrespect to the US, coupled with a toptier sovereign rating and relatively highcommodity prices, is supportive of capi-tal inflows. Yet, despite expected weak-ness in the US$, the consensus is pre-dicting that the C$ will appreciate only0.2% over the next twelve months.

0.90

1.00

1.10

1.20

1.30

1.40

1.50

1.60

1.70Jan 92 Jan 94 Jan 96 Jan 98 Jan 00 Jan 02 Jan 04 Jan 06 Jan 08 Jan 10 Jan 12

PPP Estim ate

C$/US$

-80

-60

-40

-20

0

20

40

60

'92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

FX Reserves

Current Account Balance

40

60

80

100

120

140

160

180

200

220

240


0.9

1.0

1.1

1.2

1.3

1.4

1.5

1.6

1.7

C$/US$(right scale)

'The Economist' US$ Commodity Price Index (left scale)

Average Producer Price InflationCanada (2002-11) = 1.41%US (2002-11) = 2.82%

3 Mth Actual 10 Yr Actual(Dec. 10) (Dec. 10)

Canada: 1.0% 1.7%US: 0.1% 1.6%(T-bill)

DECEMBER 20129


CANADIAN DOLLAR

C$ per US$

C$ per US$: Daily High, Low, Closing Yen/C$ Cross Rate

FORECAST: C$ PER US$SURVEY DATE SPOT

Interpolated RatesC$ per US$


On the second Monday of everymonth we ask our panel to forecastspot rates for the C$ against the US$over a range of time horizons. The Con-sensus is the mean of all the forecastsreceived, including Other Forecasterspolled whose names do not appear.FECF then calculates the annual per-cent change and the discount (-) or pre-mium (+) of this month's consensusforecast to the survey date spot rate.The interpolated quarter and annual av-erage figures shown below are basedon a simple straight line interpolationof consensus forecasts.

THE CONSENSUS

Currency Unit: The currency is the Canadiandollar (C$), which is subdivided into 100 cents.Central Bank: The Bank of Canada acts asthe lender of last resort and manages the pub-lic debt. Mr. Mark Carney is set to stand downas governor on June 1, 2013, to head the Bankof England. The term of office is seven years.Currency Linkages: The Canadian dollar isindependently floating. The USA is Canada’s big-gest trading partner and hence the relationshipwith the US dollar is particularly important.Trading and Hedging Markets: There are norestrictions on the buying/selling of foreign ex-change. Futures and options are traded on theChicago Mercantile Exchange (CME) and thePhiladelphia Stock Exchange.Government: The Prime Minister, Mr. StephenHarper, was re-elected on May 2, 2011 afterthe government collapsed in a vote of no confi-dence. The Conservative Party holds 164 ofthe 308 seats in the House of Commons. Nextelections by May 2016.Debt Ratings: Moody’s: Aaa

Standard & Poor’s: AAA

Yen perC$

0.96

0.98

1.00

1.02


`

76

78

80

82

84


Yen/C$ forecasts onpage 33.

RATE (Dec. 10, 2012) US$1 = C$ 0.987

End Jan. End Mar. End Dec. % change End Dec.

2013 2013 2013 from spot 2014

BNP Paribas 0.960 0.950 0.920 7.3 1.050Royal Bank of Canada 0.987 0.980 0.940 5.0 naABN Amro 0.980 0.980 0.950 3.9 naHSBC 0.963 0.950 0.950 3.9 naJP Morgan 0.980 0.980 0.960 2.8 naRoyal Bank of Scotland 0.970 0.980 0.960 2.8 naSociete Generale 0.990 0.990 0.960 2.8 0.980Goldman Sachs 0.990 0.990 0.967 2.1 0.967Bank of Tokyo Mitsubishi 0.985 0.975 0.970 1.8 naCommerzbank 0.973 0.980 0.970 1.8 naCitigroup 1.000 1.000 0.980 0.7 naGeneral Motors 0.987 0.993 0.990 -0.3 1.029Credit Suisse 0.991 0.990 0.991 -0.4 1.046ING Financial Markets 1.010 1.020 1.000 -1.3 0.980Morgan Stanley 0.986 0.960 1.000 -1.3 naUBS 0.970 1.000 1.030 -4.2 1.050Oxford Economics 1.001 1.001 1.033 -4.5 1.064IHS Global Insight 1.015 1.024 1.036 -4.7 1.069Allianz 1.000 1.010 1.050 -6.0 1.050

Other Forecasters (54) 0.989 0.990 0.987 0.0 1.002

CONSENSUS (Mean) 0.988 0.989 0.985 0.2 1.008

Dec. Discount/Premium on Spot -0.1 -0.2 0.2 -2.1Nov. Discount/Premium on Spot 1.7 1.4 1.5 -1.6Oct. Discount/Premium on Spot -0.3 -0.6 -1.1 -3.8


Economic Indicators and Consensus ForecastsNominal GDP (2011): US$1,739bn GDP per Capita: US$50,552 ConsensusPopulation (mid-2011) : 34.4mn Forecasts

Real GDP, %Consumer Prices, %Current Account, US$bnC$/US$, annual averageShort Term Interest Rates1

FX Reserves, end yr, US$bn1 3 mth treasury bill rate (%), end period. Forecasts for 3 and 12 months from survey date.

2008 2009 2010 2011 2012 20131.1 -2.8 3.2 2.6 2.0 1.82.4 0.3 1.8 2.9 1.6 1.81.8 -40.6 -58.4 -52.8 -68.0 -60.0

1.067 1.143 1.030 0.990 0.999 0.9880.9 0.2 1.0 0.8 1.0 1.2

41.5 42.6 44.9 52.8 na na

1 1

2012 Q4 0.991 0.9882013 Q1 0.988 0.989

Q2 0.989 0.988Q3 0.987 0.987Q4 0.986 0.985

2014 Q1 0.988 0.991Q2 0.994 0.997Q3 0.999 1.002Q4 1.005 1.008

DECEMBER 201210


DIRECTION OF TRADE

2011 % ofEXPORTS TO: US$bn TotalChina 27.1 12.0Japan 23.8 10.5USA 21.7 9.6Hong Kong 16.3 7.2Malaysia 12.3 5.4Other 125.2 55.3

TOTAL: 226.4 100.0

IMPORTS FROM:Japan 42.2 18.4China 30.6 13.4United Arab Emirates 14.5 6.3USA 13.5 5.9Malaysia 12.3 5.4Other 115.7 50.5

TOTAL: 228.9 100.0

THAILAND: Short Term and Long Term Interest Rates

THAI BAHT per US$: Actual and Purchasing Power Parity Estimates

THAILAND: Current Account and FX Reserves

%

The Purchasing Power Parity (PPP) theory asserts that, over the long term, the trendof an exchange rate is determined by cumulative differences in the inflation rates of thetwo countries concerned. In the above chart we have estimated a long term PPP trendby relating the average exchange rate (1992-2011) to indices of producer price inflationin the two countries over the same period. The PPP line above represents anapproximation of the Thai baht's correct long run valuation, and a currency may beconsidered over- or under-valued if it is more than 10% above or below the PPPestimate. On Dec 10, the Thai baht was OVERVALUED by 33% compared with itsrecently estimated PPP of Bt 40.8 per US$.

(US$bn)

ConsensusForecasts

THAI BAHT

Average Producer Price InflationThailand (2002-11) = 5.60%US (2002-11) = 2.82%

20

25

30

35

40

45

50

55Jan 96 Jan 98 Jan 00 Jan 02 Jan 04 Jan 06 Jan 08 Jan 10 Jan 12

PPP EstimateBaht/US$

0

5

10

15

20

25

30

Jan 96 Jan 98 Jan 00 Jan 02 Jan 04 Jan 06 Jan 08 Jan 10 Jan 12

Long Term Rates

Short Term Rates

1997/98 Asian Crisis

-200

20406080

100120140160180

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

FX Reserves


ActualDec. 10 End Mar. 2013 End Dec. 2013

3-month: 2.9% 3.0% 3.2%10-year: 3.4% 3.5% 3.6%

Stable Currency OutlookDespite recent anti-government protestsin Bangkok, which were eerily reminis-cent of events two years ago, the bahtheld onto its advances against both theUS dollar and the Japanese yen. Sup-port came from a favourable outlook forforeign investment, including solidgrowth prospects and stable trends ininflation, which fell to 2.7% (y-o-y) in No-vember, from 4.2% a year earlier. True,the expansion in the Thai economy easedto 3.0% (y-o-y) in Q3, from 4.4% in Q2,negatively affected by a slowdown in ex-ports and global financial turbulence.(Headwinds from abroad were underlinedas a key risk to the recovery as the Bankof Thailand slashed interest rates to2.75% in mid-October.) Yet the Novem-ber demonstrations in the capital provedshort-lived and have not had a signifi-cant effect on economic output. In addi-tion, in a scenario in which downsiderisks in the US and Europe do not mate-rialise, panellists believe that monetarypolicy will be tightened more quickly inThailand than most other Asian coun-tries. Domestic demand, investment inparticular, has been buoyed by govern-ment reconstruction efforts and repairsto manufacturing supply chains, while arecent up-tick in sentiment in Chinashould add support to the external sec-tor. Growth in Q4 should be in doubledigits in year-on-year terms due to a lowbase of comparison caused by exten-sive flooding in parts of the country inlate 2011. In addition, the consensus ispredicting that it will average 4.4% nextyear, lower than that of China but dou-ble that of the US and higher than theAsia regional average.

% Thailand: Annual GDP Growth and Inflation(year-on-year)

Recent Quarterly Outturns (y-o-y)2011 Q4 2012 Q1 Q2 Q3

GDP: -8.9% 0.4% 4.4% 3.0%CPI: 4.0% 3.4% 2.5% 2.9%

-12.0

-9.0

-6.0

-3.0

0.0

3.0

6.0

9.0

12.0

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

CPI Inflation Real GDP Growth

Consensus Forecasts

ConsensusForecasts

DECEMBER 201211


Bt per US$

FORECASTS: THAI BAHT PER US$

On the second Monday of everymonth we ask our panel to forecastspot rates for the Thai baht against theUS$ over a range of time horizons. TheConsensus is the mean of all the fore-casts received, including Other Fore-casters polled whose names do not ap-pear. FECF then calculates the annualpercent change and the discount (-) orpremium (+) of this month's consen-sus forecast to the survey date spotrate. The interpolated quarter and an-nual average figures shown below arebased on a simple straight line inter-polation of consensus forecasts.

THE CONSENSUS

THAI BAHT per US$: Daily High, Low, Closing

SURVEY DATE SPOT

Yen/Baht Cross Rate

Interpolated RatesBahts per US Dollar


Yen per Bt

THAI BAHT

Currency Unit: The currency unit is the Thaibaht (Bt) which is divided into 100 satangs.Central Bank: The Bank of Thailand comesunder the supervision of the Ministry of Fi-nance. The current governor is Mr. PrasarnTrairatvorakul.Currency Linkages: In July 1997, the centralbank abandoned the baht's peg to a basket ofcurrencies in favour of a managed float.Trading and Hedging Markets: A two-tierforeign exchange market (onshore and off-shore) operated between late 2006 and early2008 due to restrictions on currency tradingby or with non-residents. The government hassince eased capital controls, allowing the dualexchange rate system to merge into one.Government: Ms Yingluck Shinawatra (sis-ter of former leader Thaksin) was elected asThailand's first female Prime Minister in July2011. She leads the Puea Thai Party (whichhas a parliamentary majority of 265 out of 500seats) and has formed a six party coalition.Next elections by 2015.Exchange Controls: There are now few for-mal exchange controls, except for licensingrequirements for some capital transactions.Debt Ratings: Moody's: Baa1

Standard and Poor's: BBB+

2.40

2.45

2.50

2.55

2.60

2.65

2.70

2.75


30.0

30.5

31.0

31.5


RATE (Dec 10, 2012):

US$1 = Bht 30.68

Economic Indicators and Consensus ForecastsNominal GDP (2011): US345.6bn GDP per Capita: US$4,973 ConsensusPopulation (mid-2011) : 69.5mn Forecasts

Real GDP, %Consumer Prices, %Current Account, US$bnBaht/US$, annual averageShort Term Interest Rates1

Forex Reserves, end yr, US$bn1 3 mth interbank (%), end period. Forecasts for 3 and 12 months from survey date.

2008 2009 2010 2011 2012 20132.5 -2.3 7.8 0.1 5.4 4.45.5 -0.8 3.3 3.8 3.0 3.42.2 21.9 10.0 5.9 0.3 2.5

33.31 34.29 31.69 30.49 31.07 30.333.0 1.4 2.2 3.2 3.0 3.2

108.3 133.6 165.7 165.2 na na

2012 Q4 30.69 30.682013 Q1 30.63 30.54

Q2 30.44 30.34Q3 30.23 30.13Q4 30.03 29.93

2014 Q1 29.89 29.85Q2 29.82 29.78Q3 29.74 29.71Q4 29.67 29.63

1 1

End Jan. End Mar. End Dec % change End Dec2013 2013 2013 from spot 2014

UBS 31.00 30.70 27.00 13.6 27.00

Goldman Sachs na 30.50 29.00 5.8 na

JP Morgan 30.15 30.15 29.20 5.1 na

Bank of Tokyo Mitsubishi 30.45 30.20 29.75 3.1 na

HSBC 30.50 30.30 29.80 3.0 na

Bank of Nova Scotia 30.73 30.60 30.00 2.3 29.75

Morgan Stanley 30.49 30.30 30.20 1.6 na

General Motors 30.89 30.70 30.31 1.2 30.03

ING Financial Markets 30.70 30.70 30.50 0.6 30.50

Citigroup 30.40 30.51 30.54 0.5 29.87

ANZ Bank 31.50 31.40 30.80 -0.4 30.40

IHS Global Insight 30.69 30.63 31.52 -2.7 30.44

Other Forecasters (10) 30.65 30.53 30.00 2.3 29.59

CONSENSUS (Mean) 30.67 30.54 29.93 2.5 29.63

Dec Discount/Premium on Spot 0.0 0.4 2.5 3.5

Nov. Discount/Premium on Spot -0.2 0.1 1.1 3.5

Oct. Discount/Premium on Spot -0.6 -0.4 0.8 3.1

Dec High 30.15 30.00 27.00 27.00

Dec Low 31.50 31.50 31.53 30.50

Dec Standard Deviation 0.29 0.36 1.05 1.14

Yen/Baht forecastson page 33.

DECEMBER 201212


HUNGARIAN FORINT

HUNGARY: Short Term Interest Rates and Inflation

HUNGARIAN FORINTS per Euro: Actual and Purchasing Power Parity Estimates

HUNGARY: Current Account and FX Reserves

%

The Purchasing Power Parity (PPP) theory asserts that, over the long-term, the trendof an exchange rate is determined by cumulative differences in the inflation rates ofthe two countries concerned. In the above chart we have estimated a long-term PPPtrend by relating the average exchange rate (2002-2011) to indices of producer priceinflation in Hungary and the euro zone over the same period. The PPP line aboverepresents an approximation of the forint's long-run value, and a currency may beconsidered over- or under-valued if it is more than 10% above or below the PPPestimate. On December 10, the Hungarian forint was 1.1% below its recentlyestimated PPP of Hft280 per euro.

(US$bn)

DIRECTION OF TRADE

2011 % ofEXPORTS TO: US$bns TotalGermany 28.1 25.1Romania 6.4 5.7Slovakia 6.1 5.4Italy 5.6 5.0United Kingdom 5.1 4.6Other 60.8 54.2

TOTAL: 112.2 100.0

IMPORTS FROM:Germany 25.3 24.7Russia 8.9 8.6China 8.6 8.4Austria 6.4 6.2Netherlands 4.5 4.4Other 48.9 47.7

TOTAL: 102.6 100.0

Deadlock in IMF Aid TalksThe forint traded at Hft283.2 per euroon December 10, similar to its level amonth ago, but it has experienced somevolatility in between. The recession inHungary has deepened during thecourse of 2012, as the economy shrankin quarter-on-quarter terms for the thirdconsecutive time. Growth fell 0.2% inQ3, exacerbated by a slump in agricul-tural output. Other sectors of theeconomy also fared poorly, including fi-nance and insurance, while industrialproduction dropped 3.8% (m-o-m) in Oc-tober alone (based on seasonal andworking day adjusted series). Householdconsumption fell 3.9% (y-o-y) in Q3,while gross capital formation plunged8.1%. The weak economic situation hasbeen blamed partly on the controversialpolicies of Prime Minister Viktor Orban,who is trying to keep the budget deficitbelow the 3.0% of GDP threshold re-quired for EU cohesion funding. In addi-tion, investor sentiment has been par-ticularly sensitive to a lack of progressbetween the government and IMF overa possible bailout loan, as the formerpressed ahead last week with companytaxes to close holes in its public financesagainst the advice of the latter. Hunga-ry’s credit rating was downgraded to BBby S&P last month, with the agencyputting an unpredictable business envi-ronment as a key reason behind themove. The National Bank slashed inter-est rates by 25 basis points – for thefourth consecutive month – to 6.0% inlate November, in an attempt to supportthe economy, which is expected to con-tract 1.3% in 2012 and barely grow in2013 (consensus forecasts).

* vs. synthetic euro prior to Jan. '99 Average Producer Price InflationHungary (2002-2011) = 3.76%Euro zone (2002-2011) = 2.39%

145

170

195

220

245

270

295


PPP Estimate

Forints/euro*

0

5

10

15

20

25

30


Consumer Price Inflation

Short Term Interest Rates- 90 Day T-bills

-15

-5

5

15

25

35

45

55

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

FX Reserves


HUNGARY: GDP Growth and Inflation(year-on-year)%

ConsensusForecasts

Recent Quarterly GDP GrowthQ1 2012 Q2 Q3

y-o-y: -1.3% -1.4% -1.6%q-o-q: -1.1% -0.4% -0.2%

-10

-5

0

5

10

15

20

25

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

CPI Inflation

GDP Growth

ConsensusForecasts

(-0.1)

DECEMBER 201213


HUNGARIAN FORINT

Hft per Euro

Forint /US$ CrossRate

FORECASTS: HUNGARIAN FORINTS PER EURO

Hft perUS$

On the second Monday of everymonth we ask our panel to forecastspot rates for the Hungarian forintagainst the euro over a range of timehorizons. The Consensus is the meanof all the forecasts received. FECFthen calculates the annual percentchange and the discount (-) or pre-mium (+) of this month's consensusforecast to the survey date spot rate.The interpolated quarter and annualaverage figures shown below arebased on a simple straight line inter-polation of consensus forecasts.

THE CONSENSUS

HUNGARIAN FORINTS per Euro: Daily, High, Low, Closing

Currency unit: The Hungarian forint is di-vided into 100 filler.Central Bank: The state-owned NationalBank of Hungary is responsible for imple-menting monetary policy. The governor isMr. András Simor.Currency Linkages: In February 2008, thehorizontal ERM-2 like trading range arrange-ment was abandoned in favour of a inde-pendent float. Medium term inflation targetof 3.0%.Trading and Hedging Markets: Hft/US$and Hft/euro futures and options on futureson the Chicago Mercantile Exchange (CME).Government: The president is Mr. JanosAder. Mr. Viktor Orban is the prime minister,whose Fidesz party secured 263 seats inthe 386 member parliament in April 2010.Next parliamentary and presidential elec-tions by 2014 and in 2017, respectively.Debt Ratings: Moody’s: Ba1

Standard & Poor’s: BB

SURVEY DATE SPOT

Interpolated RatesForints per Euro


270

275

280

285

290

295Jul 2 12 Aug 9 12 Sep 18 12 Oct 26 12 Dec 5 12

205

215

225

235


Forint/US$forecasts on

page 33.

RATE (Dec. 10, 2012):

Euro 1 = Hft 283.2End Jan. End Mar. End Dec. % change End Dec.

2013 2013 2013 from spot 2014

HSBC 278.4 275.0 270.0 4.9 na

Commerzbank 279.0 278.0 275.0 3.0 273.0

JP Morgan 290.0 290.0 275.0 3.0 na

Credit Agricole CIB 285.0 285.0 280.0 1.1 270.0

Credit Suisse 279.5 276.4 280.0 1.1 na

Morgan Stanley 278.2 275.0 285.0 -0.6 na

Oxford Economics 282.3 285.5 286.7 -1.2 279.8

BoA - Merrill Lynch 285.0 290.0 290.0 -2.3 300.0

Raiffeisen Research 295.0 300.0 290.0 -2.3 290.0

Vienna Institute - WIIW 290.0 290.0 290.0 -2.3 290.0


CONSENSUS (Mean) 284.5 285.5 284.3 -0.4 288.2

Dec. Discount/Premium on Spot -0.5 -0.8 -0.4 -1.7

Nov. Discount/Premium on Spot -0.5 -0.5 0.6 -2.6

Oct Discount/Premium on Spot -1.1 0.1 0.5 -1.6

Dec. High 278.2 275.0 270.0 270.0

Dec. Low 295.0 300.0 307.5 317.5

Dec. Standard Deviation 5.7 8.7 10.3 16.5

2012 Q4 282.2 283.72013 Q1 284.7 285.5

Q2 285.3 285.1Q3 284.9 284.7Q4 284.5 284.3

2014 Q1 284.8 285.3Q2 285.8 286.3Q3 286.7 287.2Q4 287.7 288.2

Economic Indicators and Consensus Forecasts Nov. 2012Nominal GDP (2011): US$139.7bn GDP per Capita: US$13,970 ConsensusPopulation (mid-2011): 10.0mn Forecasts

Real GDP, %Consumer Prices, %Current Account, US$bnForints/Euro, annual averageShort Term Interest Rates1

FX Reserves, end yr, US$bn1 90 day T-bills (%), end period. Forecasts for approx. 3 and 12 months from survey date.

2008 2009 2010 2011 2012 20130.9 -6.8 1.3 1.6 -1.3 0.36.1 4.2 4.9 3.9 5.8 4.9

-11.2 -0.2 1.4 1.3 1.8 2.2252.1 281.1 275.5 279.5 288.7 284.9

9.3 6.0 5.7 7.4 6.0 5.933.6 44.7 42.5 47.7 na na

DECEMBER 201214


-10

0

10

20

30

40

50

'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13

FX Reserves


DIRECTION OF TRADE

2011 % ofEXPORTS TO: US$Bns TotalChina 17.9 22.4USA 9.0 11.3Japan 8.8 11Brazil 4.4 5.5Korea 4.3 5.4Other 35.6 44.4

TOTAL: 80.1 100.0

IMPORTS FROM:USA 14.8 20.9China 12.6 17.9Brazil 6.2 8.8Argentina 4.8 6.7Japan 2.9 4.2Other 29.4 41.6

TOTAL: 70.8 100.0

CHILEAN PESO

CHILE: Copper Prices and the Exchange Rate

CHILEAN PESOS per US$: Actual and Purchasing Power Parity Estimates

CHILE: Current Account and FX Reserves

The Purchasing Power Parity (PPP) theory of exchange rates asserts that, over the longterm, the trend of an exchange rate is determined by cumulative differences in theinflation rates of the two countries concerned. In the above chart we have estimated along term PPP trend by relating the average exchange rate (1992-2011) to indices ofproducer price inflation in the two countries over the same period. The PPP line aboverepresents an approximation of the Chilean peso's correct long run valuation, and acurrency may be considered over- or under-valued if it is more than 10% above or belowthe PPP estimate. On December 10, the Chilean peso was OVERVALUED by 46%compared with its recently estimated PPP of Ps693 per US$.

(US$bn)

CHILE: Inflation and Real Interest Rates%

Pesos/US$

US centsper pound

Average ProducerPrice InflationChile (2002-11) = 5.60%US (2002-11) = 2.82%

Slowdown ExpectedThe climb in the peso stalled after ittouched 470/US$ in late September andthe currency was held in a range nearPs480/US$ for much of November. Itsadvance, though, resumed in early De-cember, following news that the Chileaneconomy expanded by 5.7% (y-o-y) and1.4% (q-o-q) in Q3. Growth has beendriven mainly by strength in domesticdemand, with household consumptionand gross fixed investment up by 6.4%(y-o-y) and 13.3%, respectively. Ongo-ing headwinds from the US and Europe,though, suggest that that momentum willbe difficult to sustain. A quarterly tradedeficit of US$1.8bn was recorded in Q3,the first since Q4 2008, as imports out-stripped exports, while the current ac-count shortfall rose to US$4.8bn. Indus-trial production has also started to easein recent quarters, with a drop of 0.5%(y-o-y) in Q3 leading to concerns aboutpossible weakness ahead. Most observ-ers expect Chile to perform well in 2013and above the regional average, but ex-pand by less than the 5.3% estimatedin 2012. Inflation has fallen from the 4.0%levels registered at the start of the year,which has alleviated the urgency formonetary tightening. It dropped by 0.5%(m-o-m) in November, bringing the y-o-yfigure down to 2.1%, very close to thelower bound of the 2.0% to 4% targetrange set by the central bank. The bankheld rates at 5.0% at its latest meeting,citing the global uncertainty created bythe euro zone debt crisis and theupcoming ‘fiscal cliff’ in the US. On bal-ance, the consensus is predicting thatthe peso will depreciate 3.1% over thenext twelve months.

ConsensusForecasts

350

450

550

650

750


PPP Estimate

Pesos/US$

370

470

570

670


50

100

150

200

250

300

350

400

450

500

Pesos per US$(left scale)

Copper Price (right scale)

-2.0

2.0

6.0

10.0

14.0

18.0


Consumer Price Inflation(% change on previous year)

Short Term Interest Rates

DECEMBER 201215


CHILEAN PESO

Pesos per US$Peso/Yen Cross Rate

FORECASTS: CHILEAN PESOS PER US$

Pesosper Yen

Interpolated RatesPesos per US$


On the second Monday of everymonth we ask our panel to forecastspot rates for the Chilean peso againstthe US$ over a range of time horizons.The Consensus is the mean of all theforecasts received. FECF then calcu-lates the annual percent change andthe discount (-) or premium (+) of thismonth's consensus forecast to the sur-vey date spot rate. The interpolatedquarter and annual average figuresshown below are based on a simplestraight line interpolation of consensusforecasts.

THE CONSENSUS

CHILEAN PESOS per US$: Daily Closing

SURVEY DATE SPOT

Currency Unit: The Chilean peso is subdividedinto 100 centavos.Central Bank: The Banco Central de Chile wasguaranteed independence in 1989. Mr. RodrigoVergara was appointed governor of the Cen-tral Bank in December 2011.Currency Linkages: Until September 1999,the peso was linked to a basket of currencies(80% US$, 15% euro and 5% yen) and thereference rate was adjusted in line with infla-tion differentials. Now the currency floats freely.Trading and Hedging Markets: There are twospot forex markets; an official market whichaccounts for 90% of transactions and an infor-mal market for other transactions. There is alsoa forward market, but currency derivativesmarkets are not well developed.Government: Mr. Sebastián Piñera waselected President for a four-year term in Janu-ary 2010. He leads a right-wing government.The Chamber of deputies (lower house) iselected for four-year terms and members ofthe senate (upper house) serve eight-yearterms. Next elections by 2013.Debt Ratings: Moody's: Aa3

Standard & Poor's: A+

460

470

480

490

500


5.7

5.8

5.9

6.0

6.1

6.2

6.3

6.4


RATE (Dec 10, 2012)1 US$ = Ps 475.7

2012 Q4 478.2 476.82013 Q1 480.0 482.9

Q2 484.2 485.6Q3 486.9 488.2Q4 489.5 490.8

2014 Q1 490.3 489.9Q2 489.4 488.9Q3 488.5 488.0Q4 487.5 487.1


Royal Bank of Canada 463.3 460.0 450.0 5.7 na

Morgan Stanley 480.0 470.0 475.0 0.1 455.0

General Motors 473.7 479.3 486.9 -2.3 506.5

Citigroup 482.0 484.0 490.0 -2.9 na

JP Morgan 470.0 470.0 490.0 -2.9 na

Bank of Nova Scotia 486.3 493.0 497.0 -4.3 510.0

Oxford Economics 481.2 486.9 499.8 -4.8 505.2

HSBC 490.0 495.0 500.0 -4.9 490.0


Deutsche Bank na 498.0 512.0 -7.1 na

CONSENSUS (Mean) 479.1 482.9 490.8 -3.1 487.1

Dec. Discount/Premium on Spot -0.7 -1.5 -3.1 -2.3

Nov Discount/Premium on Spot 0.3 -0.4 -2.4 -3.2

Oct. Discount/Premium on Spot -0.9 -1.5 -4.0 -3.7

Dec. High 463.3 460.0 450.0 455.0

Dec. Low 490.0 498.0 512.0 510.0

Dec. Standard Deviation 8.6 12.9 18.1 24.7

Economic Indicators and Consensus Forecasts Nov. 2012Nominal GDP (2011): US$248.6bn GDP per Capita: US$14,369 ConsensusPopulation (mid-2011) : 17.3mn Forecasts

Real GDP, %Consumer Prices, Dec/Dec, %Current Account, US$bnPesos/US$, annual averageShort Term Interest Rates1

FX Reserves, end yr, US$bn1 Real rate on 90-day central bank bills (%), end period. Forecasts for approximately 3 and12 months from latest survey.

2008 2009 2010 2011 2012 20133.3 -1.0 6.1 6.0 5.3 4.67.1 -1.4 3.0 4.4 2.3 3.1

-5.8 3.5 3.3 -3.2 -7.6 -9.7522.5 560.9 510.2 483.7 486.2 485.1

8.3 0.5 3.3 5.3 5.0 5.222.8 23.8 26.3 40.1 40.2 41.2

DECEMBER 201216


Forecasts for the currencies shown on the next several pages were provided by the following leadingforecasters:

ABN AMRO ABSA Capital Allianz

ANZ Bank BoA - Merrill Lynch Bank of Nova Scotia

Bank of Tokyo Mitsubishi BNP Paribas Barclays Capital

BBVA Citigroup Commerzbank

Credit Agricole CIB Credit Suisse Deutsche Bank Research

ECOSA Erste Bank General Motors

Goldman Sachs HSBC ICICI Bank

IDEAglobal IHS Global Insight ING Financial Markets

JP Morgan Macquarie Bank Morgan Stanley

Nedbank Economics Nomura Securities Oxford Economics

Raiffeisen Research Rand Merchant Bank Roubini Global Economics

Royal Bank of Canada Royal Bank of Scotland Santander

Societe Generale Standard Bank Standard Chartered Bank

The Vienna Institute - WIIW UBS UniCredit

plus more than 200 other forecasters located in 27 countries.

% ChgePesos per US$ Consensus from ---- Range ----

of 9 F'csts Spot High Low

Interpolated Rates Pesos per US$Quarter EndAverage Quarter

ARGENTINIAN PESO

MAJOR CURRENCIES DECEMBER 2012

FORECASTERS

Policy: During 1991-2001, Argentina operated a ps1 = US$1 currencyboard system. In 2002, the government announced a devaluationand, later, floated the peso with strict exchange controls.

Outlook: Concerns about a sovereign debt default have underminedconfidence in the economy and exchange rate. In October a USfederal court barred Argentina from repaying creditors of restructuredbonds, unless it satisfied claims from holdout creditors. However, thecountry received a reprieve from a US appeals court in late Novem-ber, giving it more time to fight the earlier ruling.

2.83.03.23.43.63.84.04.24.44.64.85.05.25.4

Jan 06Jan 07 Jan 08Jan 09 Jan 10Jan 11 Jan 12

Pesos/US$

PPP Estimate (Latest: 5.30)

e = consensus estimate based on latest survey, except for FX reserves, which in some cases are latest available monthly data.

2012 Q4 4.805 4.9522013 Q1 5.137 5.243

Q2 5.349 5.455Q3 5.560 5.666Q4 5.772 5.878

2014 Q1 5.961 6.045Q2 6.129 6.212Q3 6.296 6.379Q4 6.463 6.547

Spot Rate (Dec. 10): 4.864 Forecasts (end-Jan. 2013): 5.129 -5.2 4.773 6.040 (end-Mar. 2013): 5.243 -7.2 4.913 6.130 (end-Dec. 2013): 5.878 -17.3 5.077 7.000 (end-Dec. 2014): 6.547 -25.7 5.243 8.000

Data & Forecasts Population (mid-2011): 40.8mnNominal GDP (2011): US$448.2bn Debt Ratings (M/S&P): B3/B-

Consensus

Real GDP, %Consumer Prices, Dec/Dec, %Current Account, US$bnPesos/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 30-day peso deposits (%), end period. Forecasts approximately for3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013 6.8 0.9 9.2 8.9 1.5 3.0 7.2 7.7 10.9 9.5 10.2 10.8 6.8 11.0 2.8 -0.3 1.9 2.2 3.144 3.710 3.896 4.110 4.547 5.449 15.1 9.4 10.3 13.3 14.8 15.8 44.4 42.9 46.6 40.1 40.6 41.3

1 1

US$1 reportedly boughtPs 6.45 in the black marketin early December 2012.

DECEMBER 201217


% Chge ForecastUS$ per A$ Consensus from ---- Range ---- See p.33 for cross rates of 34 F'csts Spot High Low

Interpolated Rates US$ per A$Quarter EndAverage Quarter

Policy: The A$ is free floating. Inflation target of 2% to 3%.

Outlook: The A$ has drifted higher in recent months, buoyed in partby signs of recovery in China and improving risk sentiment. Supportalso came from the out-performance of the Australian expansion,which slowed in Q3 but remained above 3% (y-o-y). Inflation roseto 2.0% (y-o-y) in Q3 and may increase following the carbon tax hikein July. However, the Reserve Bank slashed rates to 3.0% onDecember 3 in a bid to protect the recovery from external shocks anda slowdown in the mining sector.

AUSTRALIAN DOLLAR

MAJOR CURRENCIES

% Chge ForecastReals per US$ Consensus from ---- Range ----See p.33 for cross rates of 10 F'csts Spot High Low

Interpolated Rates Reals per US$Quarter EndAverage Quarter

Policy: Crawling peg was abandoned in 1999 in favour of a floatingexchange rate with inflation targeting. The tax on foreign fixed incomeinvestment was raised twice in October 2010, from 2% to 6%.

Outlook: A slowdown in the economy has weighed on the real,which slid 3.5% during November to 2.11/US$, its weakest level inmore than 3 years. Growth remained below 1.0% (y-o-y) in Q3, asincreases in public spending failed to revive investment. Govern-ment efforts to curb the strength in the currency and support themanufacturing sector have also contributed to its decline.

Policy: The C$ is independently floating. The USA is Canada'slargest trading partner, and hence the relationship with the US$ isof particular importance. Inflation target of 2%.

Outlook: See pages 8 and 9.

CANADIAN DOLLAR

BRAZILIAN REAL

% Chge ForecastC$ per US$ Consensus from ---- Range ----See p.33 for cross rates of 73 F'csts Spot High Low

Interpolated Rates C$ per US$Quarter EndAverage Quarter

0.90

0.95

1.00

1.05

1.10

1.15

1.20

1.25

1.30

Jan 06Jan 07Jan 08Jan 09Jan 10Jan 11 Jan 12

C$/US$


1.4

1.6

1.8

2.0

2.2

2.4

2.6

2.8

3.0


Reals /US$


0.55

0.65

0.75

0.85

0.95

1.05

1.15

Jan 06Jan 07Jan 08Jan 09Jan 10Jan 11Jan 12

US$/A$


2012 Q4 2.063 2.0792013 Q1 2.078 2.077

Q2 2.073 2.070Q3 2.067 2.064Q4 2.061 2.057

2014 Q1 2.058 2.058Q2 2.059 2.059Q3 2.060 2.060Q4 2.061 2.061

2012 Q4 0.991 0.9882013 Q1 0.988 0.989

Q2 0.989 0.988Q3 0.987 0.987Q4 0.986 0.985

2014 Q1 0.988 0.991Q2 0.994 0.997Q3 0.999 1.002Q4 1.005 1.008


Spot Rate (Dec. 10): 2.080 Forecasts (end-Jan. 2013): 2.078 0.1 1.993 2.120 (end-Mar. 2013): 2.077 0.2 1.980 2.150 (end-Dec. 2013): 2.057 1.1 1.930 2.200 (end-Dec. 2014): 2.061 0.9 1.950 2.200

Spot Rate (Dec. 10): 0.987 Forecasts (end-Jan. 2013): 0.988 -0.1 0.950 1.020 (end-Mar. 2013): 0.989 -0.2 0.950 1.040 (end-Dec. 2013): 0.985 0.2 0.920 1.060 (end-Dec. 2014): 1.008 -2.1 0.940 1.069

Data & Forecasts Population (mid-2011): 22.6mnNominal GDP (2011): US$1484.8bn Debt Ratings (M/S&P): Aaa/AAA

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnUS$/A$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 90-day Dealer bill rate (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 2.7 1.4 2.6 2.4 3.5 2.7

4.4 1.8 2.9 3.3 1.8 2.9 -46.4 -41.4 -36.9 -34.4 -59.1 -71.9 0.839 0.780 0.917 1.032 1.035 1.016

3.9 4.2 5.0 4.5 3.1 3.2 29.9 30.8 32.8 36.0 na na

Data & Forecasts Population (mid-2011): 196.7mnNominal GDP (2011): US$2476.7bn Debt Ratings (M/S&P):Baa2/BBB

Consensus

Real GDP, %Consumer Prices, Dec/Dec, %Current Account, US$bnReals/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn 1 SELIC overnight rate (%), end period. Forecasts for approximately3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013 5.2 -0.3 7.5 2.7 1.5 3.8

5.9 4.3 5.9 6.5 5.4 5.3 -28.2 -24.3 -47.3 -52.5 -52.1 -62.0 1.834 1.999 1.759 1.673 1.951 2.070

13.8 8.8 10.8 11.0 7.3 7.5 192.8 231.9 280.6 343.4 380.6 393.2

Data & Forecasts Population (mid-2011): 34.4 mnNominal GDP (2011): US$1739.0bn Debt Ratings (M/S&P): Aaa/AAA

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnC$/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 month treasury bills (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 1.1 -2.8 3.2 2.6 2.0 1.8

2.4 0.3 1.8 2.9 1.6 1.8 1.8 -40.6 -58.4 -52.8 -68.0 -60.0

1.067 1.143 1.030 0.990 0.999 0.988 0.9 0.2 1.0 0.8 1.0 1.2

41.5 42.6 44.9 52.8 na na

1 1

1 1

1 1

2012 Q4 1.038 1.0442013 Q1 1.032 1.023

Q2 1.019 1.015Q3 1.011 1.008Q4 1.004 1.000

2014 Q1 0.996 0.992Q2 0.988 0.984Q3 0.980 0.976Q4 0.972 0.968

DECEMBER 201218


MAJOR CURRENCIES

Policy: The peso was linked to a fixed basket of currencies until late1999. It has since been allowed to float, with policy focused ontargeting core inflation (currently set at 3%).


% Chge ForecastPesos per US$ Consensus from ---- Range ---



CHILEAN PESO

Policy: A decade-long peg was dropped in 2005 in favour of amanaged trading band. The managed rise pattern has been re-placed by a freer floating band. (See chart for details).

Outlook: As expected, the climb in the renminbi (1.76% betweenSeptember and October) eased in November and early December.Critics partly attribute its loss of steam to a drop in political pressuresafter the US elections. However, its rapid appreciation would havebeen difficult to sustain amid a slowdown in reserve accumulationand lower trade and current account surpluses (as a % of GDP).

% Chge ForecastRenminbi per US$ Consensus from ---- Range ----- See p.33 for cross rates of 27 F'csts Spot High Low

Interpolated Rates Renminbi per US$Quarter EndAverage Quarter

COLOMBIAN PESO

CHINESE RENMINBI

% Chge ForecastPesos per US$ Consensus from ---- Range ----



Policy: Independently floating since 1999. Inflation targeting (set atbetween 2% and 4%) was part of the switch to a more flexibleexchange rate strategy.

Outlook: After trading close to Ps1818/US$ during much of Novem-ber, the Colombian peso rallied in early December. Growth in theeconomy has remained resilient, while annual inflation averaged3.1% (y-o-y) in Q3, a drop from 3.3% in Q2. Policymakers might havescope for further monetary easing in 2013, after an unexpected ratereduction to 4.5% late last month.

440

480

520

560

600

640

680

720

760

800


Pesos/US$


5.605.806.00

6.206.40

6.606.807.007.20

7.407.607.808.008.20


Rmb/US$


1700

1850

2000

2150

2300

2450

2600

2750


Pesos/US$

PPP Estimate (Latest: 2207)

The daily rmb/US$ tradingband was widened from +/-

0.5% (set in 2007) to +/-1.0%in April 2012.

2012 Q4 478.2 476.82013 Q1 480.0 482.9

Q2 484.2 485.6Q3 486.9 488.2Q4 489.5 490.8

2014 Q1 490.3 489.9Q2 489.4 488.9Q3 488.5 488.0Q4 487.5 487.1

2012 Q4 6.249 6.2412013 Q1 6.251 6.249

Q2 6.234 6.219Q3 6.204 6.188Q4 6.173 6.158

2014 Q1 6.147 6.135Q2 6.124 6.113Q3 6.102 6.090Q4 6.079 6.068

2012 Q4 1811 18002013 Q1 1798 1794

Q2 1796 1799Q3 1801 1803Q4 1806 1808

2014 Q1 1810 1813Q2 1815 1817Q3 1819 1822Q4 1824 1826


Spot Rate (Dec. 10): 6.235 Forecasts (end-Jan. 2013): 6.254 -0.3 6.200 6.400 (end-Mar. 2013): 6.249 -0.2 6.150 6.450 (end-Dec. 2013): 6.158 1.2 6.020 6.350 (end-Dec. 2014): 6.068 2.8 5.890 6.300

Spot Rate (Dec. 10): 1800 Forecasts (end-Jan. 2013): 1800 0.0 1759 1821 (end-Mar. 2013): 1794 0.3 1772 1830 (end-Dec. 2013): 1808 -0.5 1750 1850 (end-Dec. 2014): 1826 -1.4 1735 1915

Data & Forecasts Population (mid-2011): 17.3 mnNominal GDP (2011): US$248.6bn Debt Ratings (M/S&P): Aa3/A+

Consensus


FX Reserves, end yr, US$bn1 Nominal rate on 90-day central bank bills (%), end period. Forecasts forapproximately 3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013 3.3 -1.0 6.1 6.0 5.3 4.6

7.1 -1.4 3.0 4.4 2.3 3.1-5.8 3.5 3.3 -3.2 -7.6 -9.7

522.5 560.9 510.2 483.7 486.2 485.18.3 0.5 3.3 5.3 5.0 5.2

22.8 23.8 26.3 40.1 40.2 41.2

Data & Forecasts Population (mid-2011): 1.3bnNominal GDP (2011): US$7298.1bn Debt Ratings (M/S&P): Aa3/AA-

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnRmb/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 One-year base lending rate for working capital (%), end period.Forecasts for 3 and 12 months from survey.

2008 2009 2010 2011 2012 2013 9.6 9.2 10.4 9.3 7.7 8.1

5.9 -0.7 3.3 5.4 2.7 3.2412.4 261.1 305.4 201.7 226.6 215.36.949 6.831 6.770 6.462 6.309 6.215

5.3 5.3 5.8 6.6 5.8 5.81759 2328 2847 3181 na na

Data & Forecasts Population (mid-2011): 46.9mnNominal GDP (2011): US$333.2bn Debt Ratings (M/S&P): Baa3/BBB-

Consensus


FX Reserves, end yr, US$bn1 Average CD rate (%), end period.

2008 2009 2010 2011 2012 2013 3.5 1.7 4.0 5.9 4.4 4.4

7.7 2.0 3.2 3.7 3.1 3.1-6.7 -5.0 -8.8 -10.0 -10.8 -10.9

1968 2158 1899 1848 1798 180010.3 4.1 3.5 5.0 na na22.8 23.2 26.3 29.0 35.8 39.1

1 1

1 1

DECEMBER 201219


MAJOR CURRENCIES

% Chge Forecast CzkKorunas per Euro Consensus from --- Range --- per

of 12 F'csts Spot High Low US$

Interpolated Rates Korunas per EuroQuarter EndAverage Quarter

CZECH KORUNA Policy: The koruna peg to a basket of currencies was abandoned inMay 1997 in favour of a managed float. Inflation targeting (currently2% with a band of +/-1%) was introduced in 1998.

Outlook: The slide in the koruna came to a halt in mid-November andthe currency has risen by around 1% since. Real GDP shrank for athird consecutive quarter in Q3, hit by government austerity meas-ures and weak demand. The National Bank is likely to hold rates ata record low 0.05% at its next meeting, despite a noticeableslowdown in inflation to 2.7% (y-o-y) last month.

Policy: The krone is linked to the euro via ERM-2, moving withinlimits of +/-2.25% around its central rate of Dkr7.46038/€. A referen-dum on euro appears unlikely anytime soon.

Outlook: The krone has retreated below 7.45 per euro in recentmonths, as Denmark adopted a negative deposit rate to countercapital inflows from investors fearful of turmoil in the euro zone.Growth of 0.1% (q-o-q) in Q3 enabled the economy to avoid atechnical recession, following a revised 0.7% contraction in Q2. Inyear-on-year terms, the economy shrank 0.5%.

DANISH KRONE % Chge Forecast Dkr

Kroners per Euro Consensus from --- Range --- perof 10 F'csts Spot High Low US$

Interpolated Rates (see page 2) Kroners per EuroQuarter EndAverage Quarter

23

24

25

26

27

28

29


Korunas/Euro


7.2

7.3

7.4

7.5

7.6

7.7

7.8


Kroners/Euro


Policy: Limits of HK$7.75 and HK$7.85 introduced around theHK$7.80 = US$1 peg in May 2005. Major FX regime changes seemunlikely until the renminbi (page 18) becomes fully convertible.

Outlook: The HK$ has remained near the limit of its two wayconvertibility band in recent months, obliging the Monetary Authorityto sell the currency each time it threatened to exceed its trading peg.Although monetary officials continue to reject calls for a review of theexchange rate regime, current policies have raised concerns aboutinflation, which was 3.8% (y-o-y) in October.

HONG KONG DOLLAR % Chge Forecast

HK$ per US$ Consensus from ---- Range ----- See p.33 for cross rates of 22 F'csts Spot High Low

Interpolated Rates HK$ per US$Quarter EndAverage Quarter

7.73

7.74

7.75

7.76

7.77

7.78

7.79

7.80

7.81

7.82

7.83


90

92

94

96

98

100

102

104

106

108

110

112

114

HK$/US$ (left scale)

Trade WeightedIndex (right scale)

2012 Q4 25.19 25.302013 Q1 25.40 25.50

Q2 25.43 25.36Q3 25.29 25.21Q4 25.14 25.07

2014 Q1 25.02 24.98Q2 24.94 24.90Q3 24.85 24.81Q4 24.77 24.73

2012 Q4 7.459 7.4582013 Q1 7.456 7.455

Q2 7.455 7.455Q3 7.455 7.455Q4 7.455 7.455

2014 Q1 7.456 7.458Q2 7.460 7.461Q3 7.463 7.465Q4 7.467 7.468

2012 Q4 7.751 7.7502013 Q1 7.769 7.776

Q2 7.776 7.775Q3 7.775 7.775Q4 7.775 7.775

2014 Q1 7.775 7.775Q2 7.775 7.775Q3 7.775 7.775Q4 7.775 7.775

Spot Rate (Dec. 10): 25.27 19.55Forecasts (end-Jan. 2013): 25.36 -0.4 25.00 25.97 19.72 (end-Mar. 2013): 25.50 -0.9 24.75 26.50 19.98 (end-Dec. 2013): 25.07 0.8 24.00 26.20 19.93 (end-Dec. 2014): 24.73 2.2 23.80 25.75 19.70

Spot Rate (Dec. 10): 7.459 5.771Forecasts (end-Jan. 2013): 7.456 0.0 7.441 7.460 5.797 (end-Mar. 2013): 7.455 0.1 7.441 7.460 5.841 (end-Dec. 2013): 7.455 0.1 7.442 7.460 5.926 (end-Dec. 2014): 7.468 -0.1 7.450 7.550 5.951


Data & Forecasts Population (mid-2011): 10.5mnNominal GDP (2011): US$215.2bn Debt Ratings (M/S&P): A1/AA-

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnKorunas/Euro, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 mth interbank (%), end period. Forecasts for approximately 3 and 12months from survey date.

2008 2009 2010 2011 2012 2013 3.1 -4.5 2.5 1.9 -1.0 0.6

6.4 1.1 1.4 1.9 3.4 2.5 -4.8 -4.8 -7.6 -6.3 -2.5 -2.8

25.01 26.48 25.30 24.60 25.15 25.31 3.6 1.5 1.2 1.2 0.5 0.5

36.5 39.4 39.7 37.5 na na


Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnKroners/Euro, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 mth Euro-krone deposits (%), end period.

2008 2009 2010 2011 2012 2013 -0.8 -5.7 1.6 1.1 0.2 0.8

3.4 1.3 2.3 2.7 2.5 1.9 9.9 10.5 18.4 18.9 17.9 16.7

7.469 7.446 7.452 7.463 7.444 7.455 4.5 1.2 1.2 1.1 na na

39.8 70.6 74.3 78.2 na na

Data & Forecasts Population (mid-2011): 7.1mnNominal GDP (2011): US$243.7bn Debt Ratings (M/S&P): Aa1/AAA

Consensus

Real GDP, %Consumer Prices, %Goods & Services Bal. US$bnHK$/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 month interbank rate (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 2.1 -2.5 6.8 4.9 1.4 3.4

4.3 0.6 2.3 5.3 4.0 3.9 22.3 16.0 12.4 9.9 6.2 5.4

7.787 7.752 7.769 7.784 7.757 7.774 0.9 0.1 0.3 0.4 0.4 0.4

182.5 255.8 268.6 282.4 na na

1 1

1 1

(upper limit)

DECEMBER 201220


7500

8500

9500

10500

11500

12500

13500

14500

15500

Jan 06Jan 07 Jan 08Jan 09Jan 10Jan 11 Jan 12

Rupiah/US$


MAJOR CURRENCIES

Policy: Until August 1997, the rupiah followed a crawling US$ pegsystem, with a 4% to 5% annual decline. It now operates under amanaged float. FX controls were tightened in late 2008.

Outlook: The downtrend in the rupiah has eased in recent months,as Bank Indonesia (backed by a large amount of FX reserves)intervened to stabilise it. Monetary officials have hinted at a tighten-ing of policy to curb inflation, which fell to 4.3% (y-o-y) in November,but may rise in 2013. The economy expanded 6.2% (y-o-y) in Q3, inline with the previous two quarters.

% Chge ForecastRupiah per US$ Consensus from ---- Range ----- See p.33 for cross rates of 25 F'csts Spot High Low

Interpolated Rates Rupiah per US$Quarter EndAverage Quarter

INDONESIAN RUPIAH

Policy: In February 2008, the horizontal ERM-2 like trading rangearrangement was abandoned in favour of a independent float.Medium term inflation target of 3%.


% Chge Forecast HftForints per Euro Consensus from --- Range --- per


Interpolated Rates Forints per EuroQuarter EndAverage Quarter

HUNGARIAN FORINT

% Chge ForecastRupees per US$ Consensus from ---- Range ----- See p.33 for cross rates of 22 F'csts Spot High Low

Interpolated Rates Rupees per US$Quarter EndAverage Quarter

Policy: The Reserve Bank targets a stable real effective exchangerate. It intervenes to influence the rupee/US$ rate to offset US$movements against other trading partners' currencies.

Outlook: Uncertainties about the global economy and the imple-mentation of structural reforms have weighed on the rupee. Itsweakness in October and much of November also reflected highinflation and twin deficits, which have restricted growth. However,the currency strengthened last week after the government won a keyvote in parliament to open the retail sector to foreign investment.

INDIAN RUPEE

225

235

245

255

265

275

285

295

305

315

325

Jan 06 Jan 07Jan 08 Jan 09 Jan 10 Jan 11Jan 12

Forints/Euro


38

40

42

44

46

48

50

52

54

56

58

60


Rupees/US$


2012 Q4 282.2 283.72013 Q1 284.7 285.5

Q2 285.3 285.1Q3 284.9 284.7Q4 284.5 284.3

2014 Q1 284.8 285.3Q2 285.8 286.3Q3 286.7 287.2Q4 287.7 288.2

2012 Q4 54.09 54.252013 Q1 53.73 53.51

Q2 53.38 53.24Q3 53.11 52.97Q4 52.84 52.71

2014 Q1 52.51 52.32Q2 52.12 51.93Q3 51.73 51.54Q4 51.34 51.15

2012 Q4 9608 96352013 Q1 9651 9667

Q2 9650 9633Q3 9616 9599Q4 9582 9565

2014 Q1 9545 9525Q2 9505 9485Q3 9465 9445Q4 9426 9406

Spot Rate (Dec. 10): 283.2 219.1Forecasts (end-Jan. 2013): 284.5 -0.5 278.2 295.0 221.2 (end-Mar. 2013): 285.5 -0.8 275.0 300.0 223.7 (end-Dec. 2013): 284.3 -0.4 270.0 307.5 226.0 (end-Dec. 2014): 288.2 -1.7 270.0 317.5 229.7


Spot Rate (Dec. 10): 9630 Forecasts (end-Jan. 2013): 9645 -0.2 9460 9800 (end-Mar. 2013): 9667 -0.4 9450 10200 (end-Dec. 2013): 9565 0.7 9100 10000 (end-Dec. 2014): 9406 2.4 8700 9800

Data & Forecasts Population (mid-2011): 10.0 mnNominal GDP (2011): US$139.7bn Debt Ratings (M/S&P): Ba1/BB

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnForints/Euro, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 90 day T-bill rate (%), end period. Forecasts for approximately3 and 12 months from latest survey date.

2008 2009 2010 2011 2012 2013 0.9 -6.8 1.3 1.6 -1.3 0.3

6.1 4.2 4.9 3.9 5.8 4.9 -11.2 -0.2 1.4 1.3 1.8 2.2 252.1 281.1 275.5 279.5 288.7 284.9

9.3 6.0 5.7 7.4 6.0 5.9 33.6 44.7 42.5 47.7 na na

Data & Forecasts* Population (mid-2011):1.2bnNominal GDP (2011): US$1909.6bn Debt Ratings (M/S&P):Baa3/BBB-

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnRupees/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn* All data are for fiscal years beginning April 1 except rupees/US$ andforex reserves 1 91 day T-bill rate (%), fiscal year end. Forecasts for 3 and12 months from survey date.

2008 2009 2010 2011 2012 2013 6.7 8.4 8.4 6.5 5.5 6.5

9.0 12.4 10.4 8.3 9.4 7.7 -27.9 -38.2 -45.9 -78.2 -71.3 -71.9 43.51 48.41 45.73 46.67 53.30 53.26

4.7 4.1 7.1 8.8 7.8 7.5 246.6 258.6 267.8 262.9 na na

Data & Forecasts Population (mid-2011): 242.3mnNominal GDP (2011):US$846.8bn Debt Ratings (M/S&P): Baa3/BB+

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnRupiah/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 month deposits (%), end year. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 6.0 4.6 6.2 6.5 6.2 6.1

9.5 4.8 5.1 5.4 4.4 5.20.1 10.6 5.1 1.7 -19.7 -15.3

9699 10390 9090 8770 9358 96246.3 5.8 6.7 5.5 5.2 5.7

49.3 60.0 90.0 103.6 na na

1 1

1 1

1 1

DECEMBER 201221


% Chge Forecast ShekelShekels per US$ Consensus from --- Range --- per

of 12 F'csts Spot High Low Euro

Interpolated Rates Shekels per US$ Quarter End Average Quarter

MAJOR CURRENCIES

MEXICAN PESO% Chge Forecast

Pesos per US$ Consensus from ---- Range -----See p.33 for cross rates of 10 F'csts Spot High Low


% Chge ForecastM$ per US$ Consensus from ---- Range ----- See p.33 for cross rates of 23 F'csts Spot High Low

Interpolated Rates M$ per US$Quarter EndAverage Quarter

Policy: Since the 1994 devaluation, Mexico has adopted a floatingexchange rate system with occasional intervention. Inflation targetingwas introduced in 2001 (currently 3% with a band of +/-1%).

Outlook: The peso has rallied in recent weeks, bouyed in part byoptimism about the economic outlook. The manufacturing PMI roseto 55.6 in November – its highest level since June – while new ordersrose in October at their fastest pace since May. Mr Enrique Pena Nietowas sworn in as Mexico’s new president on December 1, promisingto underpin economic growth and tackle crime.

MALAYSIAN RINGGIT Policy: Pegged to the US$ at M$3.80 between September 3, 1998and July 2005. The central bank has since adopted a managed floatwith exchange controls.

Outlook: Demand for ringgit denominated assets has strengthenedin recent weeks, following a positive GDP reading for Q3. Growth was5.2% (y-o-y), not far from the 5.3% average in the first half of 2012,while inflation of only 1.3% (y-o-y) in October – the same rate asSeptember – may reduce the urgency for Bank Negara Malaysia toraise rates (currently 3.0%).

2.9

3.0

3.1

3.2

3.3

3.4

3.5

3.6

3.7

3.8

3.9

4.0


Ringgit/US$


10.0

11.0

12.0

13.0

14.0

15.0


Pesos/US$


ISRAELI SHEKEL Policy: Inflation targeting was introduced in 1997, with an annualCPI price stability target range of 1% to 3%. The shekel has floatedindependently since 2004, with occasional FX intervention.

Outlook: The conflict in Gaza has hit growth in Israel through lostproductivity and the cost of military action. However, currency lossesduring the first half of November were reversed in the second half,with the shekel trading at 3.81/US$ at the end of the month. The Bankof Israel has held interest rates at 2.0%, after the 25bp cut in October,citing a lack of real inflation pressures.

3.1

3.3

3.5

3.7

3.9

4.1

4.3

4.5

4.7


Shekels/US$


2012 Q4 3.829 3.8562013 Q1 3.901 3.911

Q2 3.908 3.904Q3 3.901 3.897Q4 3.893 3.890

2014 Q1 3.901 3.911Q2 3.922 3.932Q3 3.943 3.954Q4 3.964 3.975

2012 Q4 3.053 3.0572013 Q1 3.047 3.037

Q2 3.025 3.013Q3 3.002 2.990Q4 2.978 2.966

2014 Q1 2.963 2.960Q2 2.956 2.953Q3 2.950 2.946Q4 2.943 2.940

2012 Q4 12.94 12.792013 Q1 12.79 12.78

Q2 12.75 12.72Q3 12.68 12.65Q4 12.61 12.58

2014 Q1 12.60 12.62Q2 12.63 12.65Q3 12.67 12.69Q4 12.70 12.72




Data & Forecasts Population (mid-2011): 7.6mnNominal GDP (2011): US$239.1bn Debt Ratings (M/S&P): A1/A+

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnShekels/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 mth treasury bills (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 4.0 0.8 4.8 4.8 3.1 3.1

4.6 3.3 2.7 3.4 1.8 2.2 2.2 7.3 8.2 1.9 -1.5 -1.9

3.588 3.932 3.739 3.578 3.849 3.901 3.6 1.4 2.0 2.0 na na

42.5 60.6 70.9 76.3 na na

Data & Forecasts Population (mid-2011): 28.9mnNominal GDP (2011): US$278.7bn Debt Ratings (M/S&P): A3/A-

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnRinggits/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 month interbank (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 4.8 -1.5 7.2 5.1 5.2 4.8

5.4 0.6 1.6 3.2 1.7 2.2 39.4 31.4 27.3 31.7 17.8 17.8

3.336 3.525 3.221 3.060 3.089 3.013 3.4 2.1 3.0 3.2 3.2 3.3

90.5 92.9 102.3 130.0 na na

Data & Forecasts Population (mid-2011): 114.8mnNominal GDP (2011):US$1154.3bn Debt Ratings (M/S&P): Baa1/BBB

Consensus


FX Reserves, end yr, US$bn1 28-day CETES (%), end period. Forecasts for approximately3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013 1.2 -6.0 5.3 3.9 3.9 3.5

6.5 3.6 4.4 3.8 4.1 3.7 -18.0 -5.2 -1.7 -9.2 -7.2 -13.6 11.13 13.51 12.64 12.42 13.14 12.71

8.0 4.5 4.5 4.3 4.4 4.5 94.0 94.1 114.9 137.5 163.3 175.9

1 1

1 1

DECEMBER 201222


MAJOR CURRENCIES

Policy: The krone exchange rate is determined on the basis of supplyand demand in the FX market. Inflation targeting (currently set at2.5%) was introduced in 2001.

Outlook: Mainland GDP rose 0.7% (q-o-q) in Q3, mildly lower thanthe pace set in the previous two quarters. However, oil and gasproduction fell 7.7% (q-o-q) and when included in the total, GDPcontracted 0.8%. Exports fell 3.1 per cent in Q3, while imports wereup 1.1%. The Norges Bank held rates at 1.5% at its last meeting,citing low inflation, which stood at 1.1% (y-o-y) in October.

NORWEGIAN KRONE% Chge Forecast Nkr

Kroners per Euro Consensus from --- Range --- perof 25 F'csts Spot High Low US$

Interpolated Rates Kroners per EuroQuarter EndAverage Quarter

% Chge ForecastSoles per US$ Consensus from ---- Range ----


Interpolated Rates Soles per US$Quarter EndAverage Quarter

Policy: The Peruvian sol is allowed to float independently. Since2001, the main objective of the central bank has been to maintainprice stability. Inflation target of 2% (with a band of +/-1%).

Outlook: The sol has drifted higher in recent week, driven by positivefundamentals. Peru expanded 6.5% (y-o-y) in Q3, compared with6.1% in Q1 and Q2, and is predicted to achieve a similar rate ofgrowth in 2013 (consensus), due to strength in internal demand.Gross fixed investment is forecast to increase 9.1% next year, froman estimated pace of 12.9% in 2012.

PERUVIAN SOL

7.2

7.4

7.6

7.8

8.0

8.2

8.4

8.6

8.8

9.0

9.2

9.4

9.6

9.8


Kroners/Euro


2.5

2.6

2.7

2.8

2.9

3.0

3.1

3.2

3.3

3.4

3.5


Soles/US$


% Chge ForecastUS$ per NZ$ Consensus from ---- Range ----- See p.33 for cross rates of 29 F'csts Spot High Low

Interpolated Rates US$ per NZ$Quarter EndAverage Quarter

Policy: The NZ$ floats freely, but the central bank monitors its tradeweighted value in setting monetary policy, with a view to keeping'near-term' inflation anchored near 2.0%.

Outlook: The NZ$ rallied late last week after the Reserve Bankdeclined to succumb to pressure for monetary easing and keptinterest rates unchanged at 2.5%. Hawkish statements from its newgovernor, Mr. Graeme Wheeler, also underlined his focus on infla-tion, which was only 0.8% (y-o-y) in Q3 but is forecast to graduallyincrease over the next 6-12 months.

NEW ZEALAND DOLLAR

0.50

0.55

0.60

0.65

0.70

0.75

0.80

0.85

0.90


US$/NZ$


2012 Q4 0.822 0.8352013 Q1 0.819 0.813

Q2 0.811 0.808Q3 0.806 0.803Q4 0.801 0.798

2014 Q1 0.794 0.790Q2 0.786 0.782Q3 0.778 0.774Q4 0.770 0.766

2012 Q4 7.365 7.3362013 Q1 7.328 7.322

Q2 7.307 7.293Q3 7.278 7.264Q4 7.249 7.235

2014 Q1 7.250 7.266Q2 7.281 7.297Q3 7.313 7.328Q4 7.344 7.359

2012 Q4 2.584 2.5782013 Q1 2.581 2.580

Q2 2.581 2.581Q3 2.582 2.582Q4 2.583 2.583

2014 Q1 2.584 2.585Q2 2.585 2.586Q3 2.586 2.587Q4 2.588 2.588


Spot Rate (Dec. 10): 7.339 5.678Forecasts (end-Jan. 2013): 7.329 0.1 7.067 7.500 5.699 (end-Mar. 2013): 7.322 0.2 7.000 7.500 5.737 (end-Dec. 2013): 7.235 1.4 6.900 7.500 5.752 (end-Dec. 2014): 7.359 -0.3 6.800 7.727 5.864


Data & Forecasts Population (mid-2011): 4.4mnNominal GDP (2011): US$161.6bn Debt Ratings (M/S&P): Aaa/AA

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnUS$/NZ$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 90-day bank bills (%), end year. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 -0.2 -2.3 1.7 1.3 2.3 2.5

4.0 2.1 2.3 4.0 1.2 1.7 -11.5 -2.8 -4.6 -6.5 -8.8 -10.3 0.703 0.625 0.721 0.790 0.810 0.809

5.1 2.8 3.2 2.7 2.7 3.1 11.0 14.0 15.1 15.2 na na


Consensus

Mainland GDP, %Consumer Prices, %Current Account, US$bnKroners/Euro, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 month Interbank (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 1.5 -1.4 1.5 2.6 3.4 2.7

3.8 2.2 2.4 1.3 0.8 1.7 72.7 40.5 51.9 70.3 70.5 67.1

8.223 8.729 8.008 7.793 7.476 7.291 3.9 2.2 2.6 2.9 1.9 2.1

50.2 45.6 48.9 42.5 na na

Data & Forecasts Population (mid-2011): 29.4mnNominal GDP (2011): US$176.6bn Debt Ratings (M/S&P): Baa2/BBB

Consensus

Real GDP, %Consumer Prices, Dec/Dec, %Current Account, US$bnSoles/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 180-Day Deposit Rate (%), end period.

2008 2009 2010 2011 2012 2013 9.8 0.9 8.8 6.9 6.0 5.8

6.7 0.2 2.1 4.7 3.1 3.0 -5.3 -0.7 -3.8 -3.3 -5.5 -6.2

2.924 3.012 2.825 2.754 2.637 2.582 3.3 1.5 1.8 2.6 na na

30.3 31.0 41.7 46.1 60.8 65.5

1 1

1 1

DECEMBER 201223


ROMANIAN LEU

MAJOR CURRENCIES

Policy: Managed float. The euro became the sole reference rate inMarch 2003. Exchange controls regulate the sale of foreign currency.Four zeros were dropped from the leu in July 2005.

Outlook: The leu remained stable during much of November, butslipped a little in early December due to concerns about politicalrisks and its effect on reforms and financial support from the IMF.General elections over the weekend were won by the center-leftalliance of Prime Minister Victor Ponta, who is at odds with theconservative President Traian Basescu.

% Chge Forecast LeiLei per Euro Consensus from --- Range --- per


Interpolated Rates Lei per EuroQuarter EndAverage Quarter

Policy: Until 2000 the zloty was pegged against a US$ and eurobasket. It has since been allowed to float. Inflation targeting intro-duced in 1999 (currently 2.5% with a band of +/-1%).

Outlook: The Polish zloty came under downward pressure in earlyDecember, as a loss of momentum in the economy raised theprospect of further monetary easing. Real GDP rose by only 1.9%(y-o-y) in Q3, down from 2.5% in Q2, while inflation fell to 3.4% inOctober, from 3.9% in September. The National Bank cut rates by25 basis points to 4.25% late last week.

% Chge Forecast ZlZlotys per Euro Consensus from --- Range --- per


Interpolated Rates Zlotys per EuroQuarter EndAverage Quarter

POLISH ZLOTY

3.2

3.4

3.6

3.8

4.0

4.2

4.4

4.6

4.8


Zlotys/Euro


3.0

3.4

3.8

4.2

4.6

5.0

5.4

Jan 06 Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12

Lei/Euro


Policy: The peso floats independently, although there are somerestrictions on currency sales in capital transactions and the centralbank frequently intervenes to stabilise the exchange rate.

Outlook: The peso has rallied in recent weeks, following an unex-pected surge in the economy. Real GDP rose 7.1% (y-o-y) in Q3,from a revised 6.0% in Q2, as domestic demand (household con-sumption and government spending) offset a slowdown in exports.The consensus for 2013 GDP growth has risen to 5.3% in our latestpoll, from an earlier estimate of 5.1%.

PHILIPPINE PESO% Chge Forecast

Pesos per US$ Consensus from ---- Range ----- See p.33 for cross rates of 12 F'csts Spot High Low


38

40

42

44

46

48

50

52

54

56

58

60


Pesos/US$


2012 Q4 41.14 40.952013 Q1 40.91 40.81

Q2 40.68 40.54Q3 40.41 40.27Q4 40.13 40.00

2014 Q1 40.03 40.07Q2 40.10 40.14Q3 40.17 40.21Q4 40.24 40.28

2012 Q4 4.117 4.1192013 Q1 4.141 4.153

Q2 4.138 4.124Q3 4.109 4.095Q4 4.081 4.066

2014 Q1 4.056 4.047Q2 4.037 4.027Q3 4.018 4.008Q4 3.998 3.988

2012 Q4 4.541 4.5402013 Q1 4.550 4.550

Q2 4.543 4.535Q3 4.528 4.520Q4 4.513 4.505

2014 Q1 4.501 4.496Q2 4.492 4.487Q3 4.483 4.479Q4 4.474 4.470

Spot Rate (Dec. 10): 40.94 Forecasts (end-Jan. 2013): 40.97 -0.1 40.50 41.46 (end-Mar. 2013): 40.81 0.3 40.42 41.38 (end-Dec. 2013): 40.00 2.4 37.50 41.29 (end-Dec. 2014): 40.28 1.6 38.80 41.12



Data & Forecasts Population (mid-2011): 94.9 mnNominal GDP (2011): US$224.8bn Debt Ratings (M/S&P): Ba1/BB+

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnPesos/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 month interbank rate (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 4.2 1.1 7.6 3.9 6.0 5.3

9.3 3.2 4.1 4.7 3.2 3.7 3.6 9.4 8.9 7.1 7.6 7.7

44.32 47.68 45.11 43.31 42.20 40.53 5.3 5.0 1.1 2.3 3.5 3.7

33.0 37.2 54.0 65.7 na na

2008 2009 2010 2011 2012 2013 5.1 1.6 3.9 4.3 2.3 2.0

4.2 3.5 2.6 4.3 3.8 2.7 -35.0 -17.2 -24.0 -25.0 -18.6 -18.1 3.529 4.334 3.995 4.118 4.182 4.117

5.8 3.9 3.9 4.9 4.2 4.0 58.9 78.6 73.4 89.7 na na

Data & Forecasts Population (mid-2011)21.4 mnNominal GDP (2011): US$189.8bn Debt Ratings (M/S&P): Baa3/BB+

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnLei/Euro, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 Interbank lending rate (%), end period.

2008 2009 2010 2011 2012 2013 7.4 -6.6 -1.7 2.5 0.9 2.1

7.8 5.6 6.1 5.8 3.4 4.4 -24.0 -6.9 -7.2 -8.5 -7.6 -8.8 3.690 4.235 4.211 4.238 4.440 4.533

15.5 10.7 6.2 6.1 na na 36.9 40.8 43.4 42.9 42.5 43.4

1 1

1 1

Data & Forecasts Population (mid-2011): 38.3mnNominal GDP (2011):US$514.6bn Debt Ratings (M/S&P): A2/A-

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnZlotys/Euro, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 mth interbank (%), end period. Forecasts for approximately 3 and 12months from survey date.

DECEMBER 201224


MAJOR CURRENCIES

% Chge Forecast RandRands per US$ Consensus from --- Range --- per


Interpolated Rates Rands per US$Quarter EndAverage Quarter

SOUTH AFRICAN RAND Policy: Since the abolition of the financial rand in 1995, the unifiedFX rate has been determined by market forces and exchange con-trols. Inflation targeting was introduced in 2000 (currently 3% to 6%).

Outlook: Growth fell to 1.2% (q-o-q annualised) in Q3, from 3.4% inQ2, as ongoing strikes in gold and platinum mines hit industrialoutput. The Reserve Bank kept rates unchanged at 5.0% late lastmonth to protect the rand from further weakness and due to concernsabout inflation, which rose to 5.6% (y-o-y) in October. Some observ-ers warn of possible stagnation in 2013.

% Chge ForecastS$ per US$ Consensus from ---- Range ----- See p.33 for cross rates of 24 F'csts Spot High Low

Interpolated Rates S$ per US$Quarter EndAverage Quarter

Policy: Free floating, but the S$ is monitored by the MonetaryAuthority of Singapore (MAS) against a trade-weighted basket. Theexchange rate is the main instrument used in controlling inflation.

Outlook: Early indicators suggest that the MAS will loosen monetarypolicy at its next bi-annual meeting in April 2013. Growth was barelyabove zero in year-on-year terms in Q3, hurt by the sluggish globaleconomy and lower demand for Singaporean exports. However, thedesire to stimulate output will be tempered by concerns aboutinflation, which was 4.0% (y-o-y) in October and could remainelevated due to food, fuel and wage increases.

SINGAPOREAN DOLLAR

1.15

1.20

1.25

1.30

1.35

1.40

1.45

1.50

1.55

1.60

1.65


S$/US$


5.5

6.5

7.5

8.5

9.5

10.5


Rand/US$


% Chge Forecast RblRoubles per US$ Consensus from --- Range --- per


Interpolated Rates Roubles per US$Quarter EndAverage Quarter

RUSSIAN ROUBLE Policy: Managed float with exchange controls. Russia introduced abasket (€0.45 and US$0.55) for tracking the rouble in 2005 and nowaims to keep it between a corridor of 32.45 and 37.45.

Outlook: The rouble has strengthened in recent week, buoyed inpart by plans to make local bond trading available to foreigninvestors. However, growth in the economy has slowed and areliance on oil makes it vulnerable to external shocks. The Bank ofRussia is expected to hold rates at 8.25% in the near term, as inflationrose to 6.0% (y-o-y) in Q3, from 3.9% in both Q1 and Q2.

20.0

25.0

30.0

35.0

40.0

45.0

50.0

Jan 06 Jan 07 Jan 08Jan 09 Jan 10 Jan 11 Jan 12

Roubles/US$


2012 Q4 31.13 30.892013 Q1 31.06 30.95

Q2 31.01 31.06Q3 31.11 31.17Q4 31.22 31.28

2014 Q1 31.30 31.31Q2 31.33 31.35Q3 31.36 31.38Q4 31.40 31.42

2012 Q4 1.223 1.2202013 Q1 1.217 1.213

Q2 1.210 1.206Q3 1.202 1.198Q4 1.194 1.191

2014 Q1 1.190 1.190Q2 1.190 1.190Q3 1.190 1.190Q4 1.189 1.189

2012 Q4 8.416 8.6882013 Q1 8.690 8.677

Q2 8.668 8.659Q3 8.650 8.640Q4 8.631 8.622

2014 Q1 8.633 8.643Q2 8.654 8.664Q3 8.675 8.685Q4 8.696 8.706



Spot Rate (Dec. 10): 8.682 11.22Forecasts (end-Jan. 2013): 8.700 -0.2 8.200 9.176 11.19 (end-Mar. 2013): 8.677 0.1 8.000 9.357 11.07 (end-Dec. 2013): 8.622 0.7 7.500 9.460 10.85 (end-Dec. 2014): 8.706 -0.3 7.969 9.500 10.93

Data & Forecasts Population (mid-2011):142.8mnNominal GDP (2011): US$1857.8bn Debt Ratings (M/S&P): Baa1/BBB

Consensus

Real GDP, %Consumer Prices, Dec/Dec, %Current Account, US$bnRoubles/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 Central bank refinancing rate (%).

2008 2009 2010 2011 2012 2013 5.2 -7.8 4.3 4.3 3.7 3.5

13.3 8.8 8.8 6.1 6.7 5.9 103.5 48.6 71.1 98.8 86.6 60.1 24.85 31.74 30.37 29.38 31.03 31.10

13.0 8.8 7.8 8.0 na na 412 417 444 454 486 499


Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnS$/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 month-S$ interbank (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 1.7 -1.0 14.8 4.9 1.7 2.9 6.6 0.6 2.8 5.2 4.6 3.8

27.6 34.9 55.5 57.0 44.4 46.5 1.415 1.455 1.364 1.258 1.249 1.206

0.7 0.5 0.5 0.4 0.4 0.4 173.6 186.0 223.9 235.7 na na

Data & Forecasts Population (mid-2011): 50.5mnNominal GDP (2011): US$408.2bn Debt Ratings (M/S&P): Baa1/BBB

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnRand/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn

1 3 month T-bills (%), end period.

2008 2009 2010 2011 2012 2013 3.6 -1.5 2.9 3.1 2.5 2.9

11.5 7.1 4.3 5.0 5.7 5.8 -19.6 -11.5 -10.2 -13.6 -22.9 -24.5 8.261 8.474 7.321 7.261 8.081 8.660

10.8 7.1 5.6 5.6 na na 30.2 32.4 35.4 39.8 na na

1 1

DECEMBER 201225


8.0

8.5

9.0

9.5

10.0

10.5

11.0

11.5

Jan 06 Jan 07Jan 08 Jan 09 Jan 10 Jan 11Jan 12

Kronas/Euro


MAJOR CURRENCIES

SWEDISH KRONA% Chge Forecast Skr

Kronas per Euro Consensus from --- Range --- perof 30 F'csts Spot High Low US$

Interpolated Rates Kronas per EuroQuarter EndAverage Quarter

% Chge ForecastWon per US$ Consensus from ---- Range ----- See p.33 for cross rates of 20 F'csts Spot High Low

Interpolated Rates Won per US$Quarter EndAverage Quarter

Policy: Until late-1997, the exchange rate was allowed to fluctuatein a +/-10% band around the weighted average US$ exchange ratefrom the previous day's trading. The won now floats freely.

Outlook: The advance in the won slowed in November, as the Bankof Korea bought US dollars and warned of further action to halt a lossof competitiveness, especially in relation to the Japanese yen.Growth was revised down to 0.1% (q-o-q) in Q3, from 0.3% in Q2, andthe new president (to be elected on December 19) may be con-cerned by the uptrend in the currency.

SOUTH KOREAN WON

Policy: The Swedish krona floats independently. Primary focus ofmonetary policy is the inflation target (introduced in 1993 and cur-rently set at 2.0%).

Outlook: The krona drifted lower in November, as the slowdown inthe Swedish economy deepened. Real GDP rose 0.7% (y-o-y) and0.5% (q-o-q) in Q3, below the readings in Q2, while early indicatorsfor Q4 suggest further weakness in the export-dependent nation.The manufacturing PMI index rose a little to 43.2 in November, butremains deep in negative territory.

SWISS FRANC% Chge Forecast Swfr

Francs per Euro Consensus from --- Range --- perof 30 F'csts Spot High Low US$

Interpolated Rates Francs per EuroQuarter EndAverage Quarter

1.10

1.20

1.30

1.40

1.50

1.60

1.70


Francs/Euro


Policy: Until August 2011, the Swiss franc had floated independently.In September 2011, the National Bank introduced a ceiling oncurrency appreciation set at Sfr1.20 per euro (see graph).

Outlook: The move to negative deposit rates sent the Swiss francbelow Sfr1.21 per euro late November. However, it strengthened lastweek, due to risk aversion and global uncertainties. The NationalBank reiterated last month that it was “prepared to buy foreigncurrency in unlimited quantities” to defend the ceiling and protect theSwiss industry from a loss of competitiveness.

850

950

1050

1150

1250

1350

1450

1550


Won/US$


(ceiling)

2012 Q4 1092 10812013 Q1 1082 1080

Q2 1075 1070Q3 1065 1060Q4 1055 1050

2014 Q1 1047 1044Q2 1041 1038Q3 1035 1032Q4 1029 1026

2012 Q4 8.621 8.6202013 Q1 8.556 8.546

Q2 8.522 8.498Q3 8.473 8.449Q4 8.424 8.400

2014 Q1 8.412 8.424Q2 8.436 8.448Q3 8.460 8.472Q4 8.484 8.496

2012 Q4 1.207 1.2072013 Q1 1.209 1.212

Q2 1.213 1.215Q3 1.217 1.219Q4 1.221 1.223

2014 Q1 1.224 1.226Q2 1.228 1.230Q3 1.232 1.234Q4 1.235 1.237

Spot Rate (Dec. 10): 1079 Forecasts (end-Jan. 2013): 1084 -0.4 1065 1103 (end-Mar. 2013): 1080 0.0 1050 1100 (end-Dec. 2013): 1050 2.8 1000 1150 (end-Dec. 2014): 1026 5.2 947 1116

Spot Rate (Dec. 10): 8.659 6.699Forecasts (end-Jan. 2013): 8.542 1.4 8.100 8.843 6.642 (end-Mar. 2013): 8.546 1.3 8.100 9.005 6.696 (end-Dec. 2013): 8.400 3.1 7.500 9.000 6.678 (end-Dec. 2014): 8.496 1.9 8.000 9.000 6.770


Data & Forecasts Population (mid-2011): 48.4mnNominal GDP (2011): US$1116.2bn Debt Ratings (M/S&P): Aa3/A+

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnWon/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 91-day CDs (%), end year. Forecasts for 3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013 2.3 0.3 6.3 3.6 2.2 3.2

4.7 2.8 3.0 4.0 2.3 2.6 3.2 32.8 29.4 26.5 35.0 28.7

1102 1277 1156 1108 1126 1069 3.9 2.9 2.8 3.6 2.8 3.0

200.5 265.2 286.9 298.2 na na


Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnKrona/Euro, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 mth Interbank (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 -0.8 -5.0 6.3 3.8 1.0 1.6

3.5 -0.3 1.3 2.6 0.9 0.7 44.2 27.2 31.7 38.4 34.6 35.4

9.616 10.62 9.55 9.028 8.704 8.494 2.4 0.5 2.0 2.6 1.4 1.5

25.1 39.9 42.9 38.9 na na


Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnFrancs/Euro, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 month Euro-Swiss franc deposits (%), end period. Forecasts for3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013 2.2 -1.9 3.0 1.9 0.9 1.1

2.6 -0.5 0.7 0.2 -0.6 0.210.9 53.8 78.5 69.2 75.5 74.5

1.587 1.511 1.382 1.234 1.205 1.2151.1 0.3 0.5 0.2 0.0 0.1

44.2 96.6 98.2 271.1 na na

1 1

1 1

1 1

DECEMBER 201226


MAJOR CURRENCIES

% Chge Forecast LiraLira per US$ Consensus from --- Range --- per


Interpolated Rates Lira per US$Quarter EndAverage Quarter

Policy: The crawling peg regime was abandoned in 2001, causinga sharp devaluation of the lira. The currency now floats independ-ently. Six zeroes were dropped from the lira in January 2005.

Outlook: The lira has remained between 1.76/US$ and 1.81/US$,but is susceptible to geo-political risks and financial shocks, due toa large Turkish current account deficit. Inflation, measured by CPI,fell to 6.37% (y-o-y) in November, from more than 10% earlier in2012. The monetary policy council voted for another reduction in thelending rate to 9.0% last month.

TURKISH LIRA

Policy: Managed float with intervention as required. The centralbank adopted an inflation targeting framework in 2000 (currenttarget of between 0.5% - 3.0%).


% Chge ForecastBaht per US$ Consensus from ---- Range ----- See p.33 for cross rates of 22 F'csts Spot High Low

Interpolated Rates Baht per US$Quarter EndAverage Quarter

THAI BAHT

Policy: Managed float. The central bank has intervened, sometimesheavily, in order to smooth fluctuations in the T$. A ban on foreigntime deposits was introduced in November 2009.

Outlook: Constrained by profit-taking and fear of FX intervention,the appreciation in the T$ has levelled-off in recent months. Theyear-long slowdown in the export-oriented economy passed atrough in Q3 as it expanded only 1.0% (y-o-y). However, the outlookfor the US and Europe remain uncertain and stability in the currencywill be important for the recovery in 2013.

TAIWANESE DOLLAR% Chge Forecast

T$ per US$ Consensus from ---- Range ----- See p.33 for cross rates of 19 F'csts Spot High Low

Interpolated Rates T$ per US$Quarter EndAverage Quarter

28

29

30

31

32

33

34

35

36

Jan 06Jan 07 Jan 08Jan 09 Jan 10 Jan 11Jan 12

T$/US$


29

31

33

35

37

39

41

43

45


Baht/US$


1.10

1.30

1.50

1.70

1.90

2.10


Lira/US$


2012 Q4 29.16 29.102013 Q1 29.10 29.05

Q2 29.00 28.95Q3 28.91 28.86Q4 28.81 28.77

2014 Q1 28.74 28.70Q2 28.67 28.64Q3 28.61 28.58Q4 28.55 28.52

2012 Q4 30.69 30.682013 Q1 30.63 30.54

Q2 30.44 30.34Q3 30.23 30.13Q4 30.03 29.93

2014 Q1 29.89 29.85Q2 29.82 29.78Q3 29.74 29.71Q4 29.67 29.63

2012 Q4 1.795 1.7912013 Q1 1.793 1.794

Q2 1.795 1.796Q3 1.797 1.799Q4 1.800 1.801

2014 Q1 1.804 1.807Q2 1.811 1.814Q3 1.817 1.821Q4 1.824 1.827

Spot Rate (Dec. 10): 29.08 Forecasts (end-Jan. 2013): 29.14 -0.2 28.50 30.00 (end-Mar. 2013): 29.05 0.1 28.50 30.00 (end-Dec. 2013): 28.77 1.1 28.00 30.00 (end-Dec. 2014): 28.52 2.0 28.00 30.00



Data & Forecasts Population (mid-2011): 23.2mnNominal GDP (2011): US$467.8bn Debt Ratings (M/S&P): Aa3/AA-

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnT$/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 91-day commercial paper (%), end period. Forecasts for 3 and 12months from survey date.

2008 2009 2010 2011 2012 2013 0.7 -1.8 10.8 4.1 1.1 3.4

3.5 -0.9 1.0 1.4 2.0 1.827.5 42.9 39.9 41.6 42.4 42.0

31.52 33.03 31.49 29.38 29.58 28.951.8 0.9 0.6 0.8 0.9 1.1

291.7 348.2 379.3 385.6 na na

Data & Forecasts Population (mid-2011): 69.5mnNominal GDP (2011): US$345.6bn Debt Ratings (M/S&P):Baa1/BBB+

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnBaht/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 3 month interbank (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 2.5 -2.3 7.8 0.1 5.4 4.4

5.5 -0.8 3.3 3.8 3.0 3.4 2.2 21.9 10.0 5.9 0.3 2.5

33.31 34.29 31.69 30.49 31.07 30.33 3.0 1.4 2.2 3.2 3.0 3.2

108.3 133.6 165.7 165.2 na na

Data & Forecasts Population (mid-2011): 73.6mnNominal GDP (2011): US$773.1bn Debt Ratings (M/S&P): Ba1/BB

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnLira/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn1 Overnight interbank rate (%), end period. Forecasts for approximately3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013 0.7 -4.8 9.2 8.5 2.9 4.0

10.4 6.3 8.6 6.5 9.0 7.1 -42.0 -13.4 -46.6 -77.0 -55.4 -58.9 1.302 1.550 1.503 1.675 1.800 1.796

15.0 6.5 1.5 5.0 6.4 6.4 70.2 69.2 79.0 76.7 na na

1 1

1 1

1 1

DECEMBER 201227


% Chge Forecast HrvHryvnia per US$ Consensus from --- Range --- per


Interpolated Rates Hryvnia per US$Quarter EndAverage Quarter

UNITED KINGDOM POUND Policy: The UK left the EU Exchange Rate Mechanism in September1992. Sterling now floats independently. Inflation target of 2.0%.

Outlook: The UK pound rose to US$1.61 in late November – a one-month high – buoyed in part by weakness in the dollar and news thatthe UK economy grew by 1.0% (q-o-q) in Q3. However, earlyindicators suggests that Q4 could disappoint. In his autumn state-ment, the Chancellor also admitted that it would take longer for thegovernment to curb national debt. Credit ratings agencies havewarned that the UK is at risk of losing its coveted 'AAA' status.

% Chge Forecast UK£US$ per UK£ Consensus from --- Range --- per


Interpolated Rates US$ per UK£Quarter EndAverage Quarter

MAJOR CURRENCIES

Policy: In 2003, FX trading was closed and draconian controls wereimposed. The bolivar has since suffered a series of devaluationsunder a pegged system. A two-tiered FX regime was introduced in2010 in a bid to support US$ oil earnings and curb inflation. In January2011, an anemic economy forced the government to eliminate thestronger rate of V2.6/US$ and leave the other unchanged at V4.3.

Outlook: In our special survey of currency risk assessments, theprobability attached to a devaluation of the bolivar of 20% or morein 2013 was 49.0% (see pages 34 and 35).

% Chge ForecastBolivars per US$ Consensus from ---- Range ----


Interpolated Rates Bolivars per US$Quarter EndAverage Quarter

VENEZUELAN BOLIVAR

1.40

1.50

1.60

1.70

1.80

1.90

2.00

2.10


US$/Pound


1.50

2.50

3.50

4.50

5.50

6.50


Bolivars/US$ (official rate)


UKRAINIAN HRYVNIA Policy: Closely managed against the US$ with exchange controls todiscourage sharp movements.

Outlook: The downtrend in the hryvnia was briefly broken in mid-November, but the currency ended the month at levels close to thoseat the start. Political and economic uncertainty has increased afterthe Prime Minister Mr. Mykola Azarov and his cabinet resigned fromoffice on December 3. Some commentators suggest that it was dueto its failure to secure a new IMF loan and/or a discount on Russiangas supplies. Real GDP contracted 1.3% (y-o-y) in Q3.

4.5

5.0

5.5

6.0

6.5

7.0

7.5

8.0

8.5

9.0

9.5

10.0

10.5


Hryvnias/US$


2012 Q4 8.179 8.2432013 Q1 8.534 8.762

Q2 8.855 8.948Q3 9.040 9.133Q4 9.226 9.319

2014 Q1 9.306 9.294Q2 9.281 9.269Q3 9.256 9.243Q4 9.231 9.218

2012 Q4 1.603 1.6042013 Q1 1.595 1.588

Q2 1.586 1.585Q3 1.583 1.581Q4 1.580 1.578

2014 Q1 1.578 1.577Q2 1.577 1.576Q3 1.576 1.575Q4 1.574 1.574

2012 Q4 4.363 4.5662013 Q1 5.325 6.078

Q2 6.098 6.118Q3 6.137 6.157Q4 6.176 6.196

2014 Q1 6.285 6.376Q2 6.465 6.556Q3 6.645 6.736Q4 6.825 6.916




Data & Forecasts Population (mid-2011): 45.2mnNominal GDP (2011): US$165.2bn Debt Ratings (M/S&P): B3/B

Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnHryvnia/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$bn

1 Discount rate (%), end period.

2008 2009 2010 2011 2012 2013 2.3 -14.8 4.1 5.2 0.8 2.3

25.2 15.9 9.4 8.0 1.0 7.5-12.8 -1.7 -3.0 -10.2 -11.6 -8.55.267 7.791 7.936 7.968 8.085 8.910

12.0 10.3 7.8 7.8 na na30.8 25.6 33.3 30.4 24.3 24.5


Consensus

Real GDP, %Consumer Prices, %Current Account, US$bnUS$/Pound, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$1 3 mth interbank (%), end period. Forecasts for 3 and 12 monthsfrom survey date.

2008 2009 2010 2011 2012 2013 -1.0 -4.0 1.8 0.9 -0.1 1.1

3.6 2.2 3.3 4.5 2.8 2.5 -26.7 -27.7 -57.6 -46.5 -86.0 -63.1 1.853 1.565 1.546 1.604 1.584 1.586

2.6 0.7 0.8 1.1 0.7 0.7 41.6 38.0 49.3 56.2 na na

Data & Forecasts Population (mid-2011): 29.4mnNominal GDP (2011): US$315.9bn Debt Ratings (M/S&P): B2/B+

Consensus

Real GDP, %Consumer Prices, Dec/Dec,%Current Account, US$bnBolivars/US$, annual avge.Short Term Interest Rates1

FX Reserves, end yr, US$1 30 Day Deposits, annualised, %, end period. Forecasts for approximately3 and 12 months from survey date.

2008 2009 2010 2011 2012 2013 5.3 -3.2 -1.5 4.2 5.2 1.4

31.9 26.9 27.4 29.0 19.1 27.6 34.1 6.0 12.1 24.6 21.3 22.3

2.147 2.147 2.582 4.289 4.308 5.923 17.3 15.4 14.6 14.5 14.5 14.5 32.6 17.7 9.2 6.0 15.7 16.7

1 1

1 1

US$1 reportedly boughtBs15.1 in the black marketin early December 2012.

ADDITIONAL CURRENCIES DECEMBER 201228


Algerian Dinar

Inflation, %Dinars / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float against a cur-rency basket. Rate determined byinterbank transactions.

average2006-2010 2011

4.5 4.5 -1.0 -1.5 21.1 na 127.8 180.6

Bahrain Dinar


Policy: Fixed at Bdr0.376 = US$1.Plans for monetary union with otherGCC members.

Bangladesh Taka

Inflation, %Taka / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float with a pre-announced exchange rate path sinceJune 2003.

Bolivian Boliviano

Inflation, Dec/Dec, %Bolivianos/ US$ (% chge)Current Account, US$bnFX Reserves, end yr, US$bn

Policy: The boliviano has been peggedat 6.97 to 7.07 per US$ since October2008. Capital controls.

-- Consensus Forecasts --



Ecuadorian Sucre

Inflation, Dec/Dec, %Sucres / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: The sucre was abandonedand replaced by the US$ at US$1 =Suc25,000 in 2000. (M/S&P): Caa1/B

Dominican Republic Peso

Inflation, Dec/Dec %Pesos / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Country hashigh external funding requirements.(M/S&P): B1/B+


Croatian Kuna (per Euro)

Inflation, %Kuna / Euro, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Croatia is setto join the EU in July 2013. Borderdispute with Slovenia.


60

65

70

75

80

85

90Jan 06 Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12

Dinars/US$

PPP Estimate

60

65

70

75

80

85

90


Takas/US$

PPP Estimate

6.5

7.0

7.5

8.0

8.5

9.0

9.5

10.0Jan 06 Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12

Bolivianos/US

PPP Estimate

30.0

33.0

36.0

39.0

42.0


Pesos/US$

PPP Estimate

average2006-2010 2011

7.2 6.1 2.7 1.2 1.3 0.5 5.8 9.6

average2006-2010 2011

1.3 -0.3 -0.1 0.0 1.7 3.2 3.8 4.2

average2006-2010 2011

7.7 10.7 -0.4 -13.9 1.7 0.2 6.8 7.8

7.0

7.2

7.4

7.6

7.8

8.0


Kunas/Euro

PPP Estimate

average2006-2010 2011

6.1 7.8 -2.4 -2.2 -2.9 -4.5 3.0 4.1

average2006-2010 2011

4.3 5.5 0.0 0.0 0.8 -0.3 2.4 1.6

24000

25000

26000

27000

28000

29000


Sucres/US$

PPP Estimate

average2006-2010 2011

3.1 2.3 -0.3 -1.2 -3.5 -0.4 13.2 14.0


0.32

0.34

0.36

0.38

0.40


PPP Estimate

Dinars/US$

Costa Rican Colon

Inflation, Dec,Dec, %Colons / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Crawling peg. FX transac-tions are subject to a 25% tax.(M/S&P): Baa3/BB


450

500

550

600

650


Colones/US$

PPP Estimate

average2006-2010 2011

8.8 4.8 0.2 0.2 -1.5 -2.2 3.8 4.5

Albania Lek (per Euro)

Inflation, %Leks / Euro, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Independent float. Occasionalintervention to smooth excessive FXfluctuations.

120

125

130

135

140


Leks/Euro

PPP Estimate

average2006-2010 2011

2.9 3.4 -2.3 -0.1 -1.4 -1.6 2.2 2.3


Botswanan Pula

Inflation, %Pula / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Pegged to a currency basketcomprising South African rand (70%)and SDR (30%). (M/S&P): A2/A-

Bulgarian Lev (per Euro)

Inflation, %Lev / Euro, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Pegged at Lev1.95583 = €1.The government appears to be in nohurry to adopt the euro.



5.05.56.06.57.07.58.08.59.09.5


Pulas/US$

PPP Estimate

1.5

1.8

2.1

2.4


Lev/Euro

PPP Estimate

average2006-2010 2011

9.3 8.5 -1.3 -14.4 0.9 na 8.6 7.9

average2006-2010 2011

6.7 4.2 0.0 0.0 -6.8 0.6 14.9 14.3

Azerbaijani Manat

Inflation, %Manat / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Oil-depend-ent economy. Vulnerable to drop in FXinflows. (M/S&P): Baa3/BBB-

Belarussian Rouble

Inflation, %Rouble / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Sharp devaluation in May2011. Government is seeking finan-cial aid from the IMF and Moscow.



average2006-2010 2011

10.6 8.9 1.8 1.4 10.9 17.1 4.9 10.0

0.7

0.8

0.9

1.0

1.1

1.2

1.3


Manats/US$

PPP Estimate

2000

3000

4000

5000

6000

7000

8000


Rouble/US$

PPP Estimate

average2006-2010 2011

10.1 52.3 -6.5 -64.1 -4.8 -5.7 3.0 5.4

(M/S&P): B3/B-

(M/S&P): B1/B+(M/S&P):Ba3/BB-

(M/S&P): Baa2/BBB

(M/S&P):Baa3/BBB-

(M/S&P): Baa1/BBB

(M/S&P):Ba3/BB-

Angolan Kwanza

Inflation, %Kwanza / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. The kwanzahas been largely stable since 2003.Oil-dependent economy.

60

80

100

120

140

160


Kwanza/US$

PPP Estimate

-- Consensus Forecasts --average2006-2010 2011

13.2 13.5 -2.8 -2.8 5.7 na 14.0 27.0

(M/S&P): Ba3/BB-

Spot 3 mth 12 mth 24 mth139.7 139.2 138.4 136.7

Spot 3 mth 12 mth 24 mth78.60 78.63 79.90 81.80

Spot 3 mth 12 mth 24 mth95.79 99.11 107.4 125.6

Spot 3 mth 12 mth 24 mth0.784 0.788 0.788 0.788

Spot 3 mth 12 mth 24 mth80.93 83.51 85.58 90.10

Spot 3 mth 12 mth 24 mth8620 9250 10300 11800

Spot 3 mth 12 mth 24 mth6.910 6.932 6.952 7.070

Spot 3 mth 12 mth 24 mth7.890 8.069 8.409 8.390

Spot 3 mth 12 mth 24 mth1.956 1.956 1.956 1.956

Spot 3 mth 12 mth 24 mth497.9 503.3 509.8 522.6

Spot 3 mth 12 mth 24 mth7.531 7.543 7.537 7.470

Spot 3 mth 12 mth 24 mth40.10 39.97 40.42 40.85

Spot 3 mth 12 mth 24 mth1.000 1.000 1.000 1.000

DECEMBER 2012 ADDITIONAL CURRENCIES29


Jordanian Dinar


Policy: Effectively pegged to theUS$ since late 1995.(M/S&P): BA2/BB


Iranian Rial

Inflation, %Rials/ US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float with exchangecontrols. Rial has dipped amid USeconomic sanctions.

Guyanese Dollar

Inflation, %G$ / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Guyana is arecipient of an IMF ESAF grant. Blackmarket rates.

Ghanaian Cedi

Inflation,%Cedis / US$, % changeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Exchangerestrictions. Four zeros dropped fromCedi in 2007. (S&P): B


Haitian Gourde

Inflation, %Gourdes / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float with no pre-determined path for the exchange rate.

Honduran Lempira

Inflation, %Lempira / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Crawling peg until 2006.Lempira now trades in a narrow cur-rency band. (M/S&P): B2/B+

Guatemalan Quetzal

Inflation, %Quetzals / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Rate deter-mined by transactions in the interbankmarket. (M/S&P): Ba1/BB

Kazakhstani Tenge

Inflation, %Tenge / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: De facto currency peg. 18%devaluation in the tenge in February2009. (M/S&P): Baa2/BBB+


Jamaican Dollar

Inflation, %J$ / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Rates largelymarket-determined.(M/S&P): B3/B-

Ivory Coast (CFA Franc)

Inflation, %CFA francs / Euro, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Pegged at CFA franc 655.957per euro. Also used in other formerFrench African colonies.

average2006-2010 2011

13.6 8.7 -8.9 -4.9 -2.2 na 2.6 5.1

0.8

1.0

1.2

1.4

1.6

1.8


Cedis/US$PPP Estimate

average2006-2010 2011

7.1 5.5 -1.0 2.7 -1.2 -1.5 4.5 5.6

7.0

7.5

8.0

8.5

9.0

9.5

10.0


Quetzals/US$

PPP Estimate

average2006-2010 2011

6.4 5.0 -0.2 -0.1 -0.2 na 0.5 0.8

195

205

215

225

235


G$/US$

PPP Estimate

average2006-2010 2011

8.6 8.4 -1.2 -2.7 -0.9 na 0.6 1.1

32

36

40

44

48

52

56

60


Gourdes/US$

PPP Estimate

average2006-2010 2011

6.8 6.7 0.0 0.0 -1.0 -1.5 2.4 2.6

18.0

19.0

20.0

21.0

22.0

23.0

24.0


Lempiras/US$

PPP Estimate

average2006-2010 2011

15.7 20.6 -2.1 -3.2 22.5 na 78.4 na

7000

9500

12000

14500

17000

19500


Rials/US$

PPP Estimate

average2006-2010 2011

2.7 4.5 0.0 0.0 0.6 na 2.5 3.9

640

650

660

670

680

690

700


CFA francs/Euro

PPP Estimate

average2006-2010 2011

12.5 7.5 -4.8 -0.9 -1.6 na 2.0 2.0

60

70

80

90

100

110


J$/US$

PPP Estimate

average2006-2010 2011

6.2 4.4 0.0 0.0 -2.0 -2.9 9.4 11.2

0.64

0.68

0.72

0.76

0.80

0.84


Dinars/US$

PPP Estimate

average2006-2010 2011

10.2 8.4 -2.9 -0.6 -1.1 14.1 19.3 24.6

115

135

155

175

195


Tenge/US$

PPP Estimate

-- Consensus Forecasts --average

2006-2010 2011 11.7 10.1 -0.3 -3.7 -1.2 na 30.0 13.7

5.0

5.5

6.0

6.5

7.0

7.5

8.0


Pounds/US$

PPP Estimate

Egyptian Pound

Inflation, %E£/ US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: US$ linked band abolished in2003. Managed float with exchangecontrols. (M/S&P): B2/B

Icelandic Krona

Inflation, %Krona / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Independent float. Krona hasstabilised, following crisis in 2008.(M/S&P): Baa3/BBB-

average2006-2010 2011

8.4 4.0 -9.0 -6.2 -2.8 -1.0 3.5 7.7

55

75

95

115

135


Kronas/US$

PPP Estimate

Georgian Lari

Inflation, %Laris/ US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Lari replacedRussian rouble in 1993. Inflation tar-get of 6% for 2012-2014.

-- Consensus Forecasts* --

El Salvadorian Colon

Inflation, %Colones / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Colon was replaced by the US$as the official currency in 2001 atCs8.75=US$1. (M/S&P): Ba3/BB-

average2006-2010 2011

3.5 5.1 0.0 0.0 -0.9 -1.2 2.2 1.9

8.6

8.8

9.0

9.2

9.4


Colones/US$

PPP Estimate


(M/S&P): Ba3/BB-




* Forecasts approximately for 3, 12 and 24 months from survey date

average2006-2010 2011

7.5 8.7 -0.7 6.1 -1.8 -1.8 1.5 2.6

1.4

1.5

1.6

1.7

1.8

1.9

2.0

2.1


Lari/US$

PPP Estimate


US$1 reportedly boughtalmost 35,000 rial in the

black market inOctober 2012.

Spot 3 mth 12 mth 24 mth6.144 6.170 6.294 6.550

Spot 3 mth 12 mth 24 mth8.748 8.749 8.749 8.749

Spot 3 mth 12 mth 24 mth1.663 1.667 1.682 1.719

Spot 3 mth 12 mth 24 mth1.891 1.920 1.958 2.062

Spot 3 mth 12 mth 24 mth7.837 7.892 7.954 8.091

Spot 3 mth 12 mth 24 mth19.85 19.89 20.35 20.96

Spot 3 mth 12 mth 24 mth126.8 128.1 132.1 129.2

Spot 3 mth 12 mth 24 mth656.0 656.0 656.0 656.0

Spot 3 mth 12 mth 24 mth0.710 0.709 0.709 0.709

Spot 3 mth 12 mth 24 mth150.3 151.6 152.1 153.9

ADDITIONAL CURRENCIES DECEMBER 201230


110

160

210

260

310


Kwachas/US$

0

100

200

300

400

500

600

700

800


Kyat/US$

7500

8500

9500

10500

11500

12500


Kips/US$

PPP Estimate

3.00

3.30

3.60

3.90

4.20


Litas/Euro

PPP Estimate

Nigerian Naira

Inflation, %Naira / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. FX Controls.Exchange rate adjusted to meet policyobjectives. (M/S&P): Ba3/BB-


Myanmarian Kyat

Inflation, %Kyat / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: The 35-year pegged exchangerate system was scrapped on April 1,2012 in favour of a managed float.

Nicaraguan Cordoba

Inflation, %Cordobas / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Crawling peg. 5% annual de-preciation against the US$. No signifi-cant exchange or capital controls.

Pakistani Rupee

Inflation, %Rupees / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Transactionsin the interbank market. Border dis-putes with India. (M/S&P): Caa1/B-


Malawian Kwacha

Inflation, %Kwacha / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Prior to its devaluation andshift to a free float regime in April 2012,the kwacha was heavily managed.

Latvian Lat (per Euro)

Inflation, %Lats/euro, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: ERM-II adopted in May 2005.Limits of +/-15% around a central rate ofL0.702804/€. Risk of devaluation.

Laos Kip

Inflation, %Kip / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Kip is permittedto move within assigned ranges againstthe US$ and Thai baht.



Lebanese Pound

Inflation, %L£/ US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed exchange rate. In-terest rates are set at levels to spurcapital inflows. (M/S&P): B1/B


Lithuanian Litas (per Euro)

Inflation, %Litas / euro, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: ERM-II adopted. Pegged atLtl3.4528 per euro. Euro adoption likelyto be delayed to 2015 or later.

Oman Rial

Inflation, %Rials/US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Pegged at Rials 2.6008 =US$1. Problems with inflation in 2008.(M/S&P): A1/A

Kuwaiti Dinar


Policy: Pegged to undisclosed cur-rency basket. Plans for monetary un-ion with other GCC members.

Moroccan Dirham

Inflation, %Dirham / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Pegged to currency basketweighted according to principal trad-ing partners. (M/S&P): Ba1/BBB-

-- Consensus Forecasts -- -- Consensus Forecasts --average

2006-2010 2011 5.4 4.8 0.6 0.7 41.9 na 16.3 22.9

Spot 3 mth 12 mth 24 mth0.282 0.286 0.291 0.2900.26

0.28

0.30

0.32

0.34


Dinars/US$

PPP Estimate

average2006-2010 2011

5.0 7.6 3.8 1.0 0.1 na 0.6 na

average2006-2010 2011

6.9 4.4 -0.2 1.5 -3.4 -0.4 5.7 5.9

Spot 3 mth 12 mth 24 mth0.696 0.697 0.697 0.697

Spot 3 mth 12 mth 24 mth1506 1505 1505 1505

average2006-2010 2011

5.0 5.1 0.0 0.0 -4.2 na 21.2 33.4

1460

1500

1540

1580

1620

1660


Pounds/US$

PPP Estimate

average2006-2010 2011

5.3 4.1 0.0 0.1 -2.6 -0.6 6.4 7.7

Spot 3 mth 12 mth 24 mth3.453 3.452 3.452 3.452

average2006-2010 2011

9.3 7.6 -1.6 -7.9 -0.6 -0.8 0.2 0.2

average2006-2010 2011

2.2 0.9 0.2 -2.6 -2.8 -8.3 22.0 18.8

Spot 3 mth 12 mth 24 mth8.589 8.599 9.011 9.177

7.0

7.5

8.0

8.5

9.0

9.5


Dirham/US$

PPP Estimate

average2006-2010 2011

18.3 5.1 0.5 -0.6 1.3 na 3.8 7.0

average2006-2010 2011

9.9 8.1 -3.8 -4.8 -1.1 -1.3 1.2 1.7

16.0

18.0

20.0

22.0

24.0


Cordobas/US$PPP Estimate

average2006-2010 2011

10.1 10.9 -3.2 -4.8 24.1 8.7 44.3 32.6

Spot 3 mth 12 mth 24 mth157.1 159.5 160.2 163.1

110

130

150

170

190

210

230


Naira/US$

PPP Estimate

average2006-2010 2011

12.7 12.2 -6.6 -4.7 -7.2 -2.2 11.0 13.5

Spot 3 mth 12 mth 24 mth96.93 98.37 102.8 108.555

65

75

85

95

105

115


Rupees/US$

PPP Estimate

0.60

0.65

0.70

0.75

0.80

0.85


Lats/Euro

PPP Estimate

Libyan Dinar


Policy: Offical exchange rate peggedat Ld1 = SDR 0.5175, with a 25%margin of fluctuation.

1.10

1.15

1.20

1.25

1.30

1.35


Dinars/US$

PPP Estimateaverage

2006-2010 2011 4.6 na 0.5 -0.3 22.5 na 83.9 97.1

0.35

0.36

0.37

0.38

0.39

0.40

0.41

0.42

0.43


Rials/US$

PPP Estimate

average2006-2010 2011

5.3 4.1 0.0 0.0 3.7 10.3 10.1 14.0

(M/S&P):Baa3/BBB (Moody's): B3

(M/S&P): Baa1/BBB

Spot 3 mth 12 mth 24 mth24.06 24.39 24.95 26.06


* Forecasts approximately for 3, 12 and 24 months from survey date

Kenyan Shilling

Inflation, %Shillings / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Dependenceon agriculture and tourism.(M/S&P): B1/B+


2006-2010 2011 12.8 14.0 -3.0 -5.1 -1.5 na 3.2 4.2

50

70

90

110

130


Shillings/US$

PPP Estimate

Under a new FX system, thekyat was set at K818/US$ on

April 1, 2012, closer to thepreviously prevailing black

market rates.

Spot 3 mth 12 mth 24 mth85.88 89.03 93.00 103.0

(M/S&P):Aa2/AA

DECEMBER 2012 ADDITIONAL CURRENCIES31


14500

16500

18500

20500

22500

24500

26500


Dong/US$

PPP Estimate

Zambian Kwacha

Inflation, %Kwachas / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Kwacha will beredenominated in January 2013, withthree zeros taken off.


Yemeni Rial

Inflation, %Rials / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Independent float. Rial tum-bled in first half of 2010 due to con-cerns about internal security.

Vietnamese Dong

Inflation, %Dong / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Currency wasdevalued by 7.0% in February 2011.Black market rates.



Uruguayan Peso

Inflation, Dec/Dec %New Pesos/US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Independent float after crawl-ing peg was abandoned in 2002.(M/S&P): Baa3/BBB-

Ugandan Shilling


Policy: Independent float. Rate de-termined in the interbank market.(S&P): B+


Syrian Pound

Inflation, %S£/ US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float with capital con-trols. Currency has plummeted sincelate 2011 due to internal war.

Sudanese Pound

Inflation, %Pounds / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Devalued to4.4/US$ in July 2012 to bring it closerto its black market rate.

Tanzanian Shilling


Policy: Independent float. Agricultureaccounts for largest portion of theeconomic output.

Tunisian Dinar


Policy: Managed float. Rate determinedin the interbank market.(M/S&P): Baa3/BB

UAE Dirham

Inflation, %Dirhams / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Pegged at D3.67275 = US$1.Plans for monetary union with otherGCC members. (Moody's): Aa2

Sri Lankan Rupee

Inflation, %Rupees / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Independent float. Some FXcontrols were imposed on forward con-tracts in 2008. (M/S&P): B1/B+

Serbian Dinar (per Euro)

Inflation, %Dinars / Euro, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Serbia pro-claimed independence in 2006.(S&P): BB-

Saudi Arabian Riyal

Inflation, %Riyals/ US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Pegged at riyals 3.745 = US$1.Plans for monetary union with otherGCC members. (M/S&P): Aa3/AA-




Spot 3 mth 12 mth 24 mth3.750 3.750 3.750 3.750

average2006-2010 2011

5.3 4.9 0.0 0.0 82.5 158.5 359.5 525.5

3.4

3.6

3.8

4.0

4.2


Riyals/US$

PPP Estimate

average2006-2010 2011

9.0 11.3 -5.7 1.2 -5.6 -4.4 12.8 14.9

average2006-2010 2011

11.6 7.1 -0.6 -2.6 -1.7 -4.7 3.9 6.2

Spot 3 mth 12 mth 24 mth128.8 131.2 132.2 136.595

105

115

125

135

145

155


Rupees/US$

PPP Estimate

average2006-2010 2011

10.8 na -4.1 -7.3 -2.6 na 1.2 na

1.8

2.1

2.4

2.7

3.0

3.3

3.6

3.9

4.2

4.5


Pounds/US$

PPP Estimate

average2006-2010 2011

7.4 4.7 1.7 -13.1 0.1 na 17.3 na

40

45

50

55

60

65

70

75

80


Syrian Pound/US$

PPP Estimate

average2006-2010 2011

8.6 12.7 -2.8 -7.4 -2.5 -4.6 3.0 3.5

Spot 3 mth 12 mth 24 mth1602 1615 1666 1756

1000110012001300140015001600170018001900


Shillings/US$

PPP Estimate

average2006-2010 2011

4.2 3.5 -2.0 -4.1 -1.3 na 8.6 na

average2006-2010 2011

7.0 0.9 0.0 0.0 -44.4 na 38.6 36.1

1.1

1.2

1.3

1.4

1.5

1.6


Dinars/US$

PPP Estimate

3.50

3.55

3.60

3.65

3.70

3.75


Dirhams/US$

PPP Estimate

average2006-2010 2011

8.5 18.6 -5.5 -7.3 -1.1 -2.3 2.4 2.4

Spot 3 mth 12 mth 24 mth2695 2619 2761 2872

1500170019002100230025002700290031003300


Shillings/US$

PPP Estimate

Spot 3 mth 12 mth 24 mth19.35 20.30 20.54 20.75

average2006-2010 2011

7.4 8.1 4.0 1.0 -0.6 -0.9 5.7 9.8

15.0

20.0

25.0

30.0


Pesos/US$

PPP Estimate

average2006-2010 2011

11.0 18.6 -3.2 -9.1 -5.8 0.2 17.8 13.1

Spot 3 mth 12 mth 24 mth20840 20983 21342 21779

average2006-2010 2011

10.9 16.4 -1.5 0.0 -1.4 -1.7 7.1 4.2

190

200

210

220

230

240

250

260


Rials/US$

PPP Estimate

average2006-2010 2011

10.8 6.4 -1.7 -6.3 -0.2 0.1 1.1 1.7

Spot 3 mth 12 mth 24 mth5270 5166 5216 5612

3000

4000

5000

6000

7000


Kwachas/US$

PPP Estimate

30

50

70

90

110


Dinars/Euro

PPP Estimate

Paraguayan Guarani

Inflation, Dec/Dec %Guarani / US$, % chgeCurrent Account, US$bnFX Reserves, end yr, US$bn

Policy: Managed float. Central bankwill intervene to smooth out fluctationsin the currency. (M/S&P): B1/BB-


2006-2010 2011 7.5 7.2 5.8 0.8 0.0 -0.7 2.3 3.9

Spot 3 mth 12 mth 24 mth4300 4591 4762 4649

3500

4500

5500

6500


Guaranis/US$

PPP Estimate

Spot 3 mth 12 mth 24 mth114.2 115.0 112.0 112.0


(M/S&P):B2/BB-

US$ peg dropped in July 2007 infavour of SDR link.

Black market rate was aroundSYP90/US$ in Dcember 2012.

DECEMBER 201232


LONG TERM CONSENSUS FORECASTS

Currency per US$ or euro, except the UK£,A$ and euro, which are the reciprocal.

The figures for 2012 and 2013 in the table below are based on consensus forecasts from our current survey. Figures for2014-2018 are taken from our October 2012 survey of long-term forecasts, in which we polled for panellists' end-yearforecasts and interpolated the results to obtain period averages.

------------------------ Consensus Forecasts ------------------------2011 2012 2013 2014 2015 2016 2017 2018

(actual)G-7 & EUROPEForecasts vs EuroCzech koruna end year

annual average

Hungarian forint end yearannual average

Polish zloty end yearannual average

Swedish krona end yearannual average

Swiss franc end yearannual average

Forecasts vs US DollarEuro end year(US$ per euro) annual average

Japanese yen end yearannual average

UK pound end year(US$ per pound) annual average

Canadian dollar end yearannual average

Russian rouble end yearannual average

ASIA/PACIFICAustralian dollar end year(US$ per A$) annual average

Chinese renminbi end yearannual average

Hong Kong dollar end yearannual average

Indian rupee end yearannual average

Singapore dollar end yearannual average

South Korean won end yearannual average

Taiwan dollar end yearannual average

LATIN AMERICAArgentinian peso end year

annual average

Brazilian real end yearannual average

Mexican peso end yearannual average

1.016 1.044 1.000 0.968 0.929 0.891 0.857 0.8491.032 1.035 1.016 0.984 0.949 0.910 0.874 0.853

6.301 6.241 6.158 6.068 5.938 5.835 5.706 5.6276.462 6.309 6.215 6.113 6.003 5.887 5.771 5.667

7.765 7.750 7.775 7.775 7.764 7.769 7.773 7.7727.784 7.757 7.774 7.775 7.770 7.767 7.771 7.772

53.26 54.25 52.71 51.15 50.61 51.10 51.28 51.5846.67 53.30 53.26 51.93 50.88 50.86 51.19 51.43

1.301 1.220 1.191 1.189 1.176 1.157 1.130 1.1151.258 1.249 1.206 1.190 1.183 1.166 1.143 1.123

1152 1081 1050 1026 1008 1009 1002 9971108 1126 1069 1038 1017 1009 1006 1000

30.28 29.10 28.77 28.52 28.37 28.20 27.87 27.9429.38 29.58 28.95 28.64 28.44 28.29 28.04 27.91

4.284 4.952 5.878 6.547 6.861 7.013 7.137 7.3504.110 4.547 5.449 6.212 6.704 6.937 7.075 7.244

1.859 2.079 2.057 2.061 2.059 2.085 2.174 2.1941.673 1.951 2.070 2.059 2.060 2.072 2.130 2.184

13.99 12.79 12.58 12.72 12.73 12.88 12.89 13.0512.42 13.14 12.71 12.65 12.73 12.80 12.88 12.97

25.80 25.30 25.07 24.73 23.09 22.95 22.74 23.1624.60 25.15 25.31 24.90 23.91 23.02 22.85 22.95

311.4 283.7 284.3 288.2 289.9 290.1 290.3 290.5279.5 288.7 284.9 286.3 289.1 290.0 290.2 290.4

4.422 4.119 4.066 3.988 3.602 3.566 3.532 3.5724.118 4.182 4.117 4.027 3.795 3.584 3.549 3.552

8.913 8.620 8.400 8.496 8.456 8.496 8.503 8.5069.028 8.704 8.494 8.448 8.476 8.476 8.499 8.504

1.218 1.207 1.223 1.237 1.276 1.300 1.318 1.3251.234 1.205 1.215 1.230 1.257 1.288 1.309 1.322

1.294 1.290 1.258 1.255 1.303 1.299 1.311 1.3211.390 1.285 1.271 1.256 1.279 1.301 1.305 1.316

77.72 82.00 83.49 85.47 84.85 86.77 87.76 89.1379.81 79.67 82.38 84.48 85.16 85.81 87.26 88.44

1.546 1.604 1.578 1.574 1.645 1.671 1.687 1.6981.604 1.584 1.586 1.576 1.609 1.658 1.679 1.693

1.021 0.988 0.985 1.008 1.035 1.051 1.067 1.0730.990 0.999 0.988 0.997 1.021 1.043 1.059 1.070

32.20 30.89 31.28 31.42 33.81 34.08 34.45 34.7729.38 31.03 31.10 31.35 32.61 33.94 34.26 34.61

33


DECEMBER 2012

In the tables below, we show spot and consensus forecast cross-rates for most of the major currencies. For the main Asia/Pacific currencies (below right) we show rates against the Japanese yen, Chinese renminbi and the US dollar. For theeastern and western European currencies (below) we show cross rates against both the euro and the US dollar. Thetriangular table (bottom left) shows cross rates between the G-7, Brazilian, Chinese and Mexican currencies. Latest ratesare those that prevailed at the close of trading on this month's survey date.

UK pound

Brazlianreal

vs US$ vs Euro

Eastern EuropeanConsensus Forecasts

Western EuropeanConsensus Forecasts

vs US$ vs Eurovs US$

The cross rate forecasts set out inthe triangular table below arecalculated as the amount of a

currency at the end of a row thatbuys one unit of the currency at the

head of the appropriate column.

G-7, Brazil, China and Mexico Cross Rate Consensus Forecasts

Russianrouble

Polishzloty

Hungarianforint

Czechkoruna

Swissfranc

Swedishkrona

Danishkrone

Asia/Pacific Consensus Forecasts

Malaysianringgit

New Zealanddollar

(US$ per NZ$)

SingaporeanDollar

South Korean won1

Taiwanesedollar

Thaibaht

Australiandollar

(US$ per A$)

vs renminbi (rmb per unit 1)

Hong Kongdollar

Norwegiankrone

Indianrupee

Indonesianrupiah1

Canadiandollar

US dollar

Euro

CROSS RATE FORECASTS

Chineserenminbi

vs Yen(¥ per unit 1)

Mexicanpeso

Japaneseyen

1 Currencies shaded in purpleabove (i.e. the Indonesian rupiah

and South Korean won) aremeasured as units per ¥ or rmb.

19.55 25.27

19.98 25.50

19.93 25.07

19.70 24.73

219.1 283.2

223.7 285.5

226.0 284.3

229.7 288.2

3.178 4.108

3.254 4.153

3.233 4.066

3.178 3.988

30.73 39.72

30.95 39.50

31.28 39.34

31.42 39.43

5.771 7.459

5.841 7.455

5.926 7.455

5.951 7.468

5.678 7.339

5.737 7.322

5.752 7.235

5.864 7.359

6.699 8.659

6.696 8.546

6.678 8.400

6.770 8.496

0.934 1.207

0.949 1.212

0.972 1.223

0.986 1.237

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

1.050 86.44 6.545

1.023 83.67 6.393

1.000 83.49 6.158

0.968 82.76 5.875

7.750 10.62 0.804

7.776 10.52 0.804

7.775 10.74 0.792

7.775 10.99 0.780

54.52 1.510 0.114

53.51 1.529 0.117

52.71 1.584 0.117

51.15 1.671 0.119

9630 117.0 1545

9667 118.2 1547

9565 114.5 1553

9406 110.0 1550

3.060 26.91 2.038

3.037 26.93 2.058

2.966 28.15 2.076

2.940 29.07 2.064

0.835 68.71 5.203

0.813 66.50 5.081

0.798 66.64 4.915

0.766 65.45 4.646

1.222 67.40 5.104

1.213 67.41 5.151

1.191 70.12 5.172

1.189 71.86 5.102

1079 13.16 173.1

1080 13.16 172.8

1050 12.50 170.5

1026 12.05 169.1

29.08 2.831 0.214

29.05 2.816 0.215

28.77 2.902 0.214

28.52 2.997 0.213

30.68 2.684 0.203

30.54 2.678 0.205

29.93 2.790 0.206

29.63 2.884 0.205

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

Latest

End Mar. 2013

End Dec. 2013

End Dec. 2014

1.244

1.244

1.255

1.254

1.608 1.293

1.588 1.276

1.578 1.258

1.574 1.255

1.587 1.276 0.987

1.571 1.263 0.989

1.555 1.239 0.985

1.587 1.265 1.008

3.344 2.689 2.080 2.107

3.298 2.650 2.077 2.099

3.247 2.588 2.057 2.088

3.244 2.587 2.061 2.045

10.022 8.059 6.235 6.316 2.998

9.924 7.976 6.249 6.316 3.009

9.718 7.746 6.158 6.250 2.993

9.550 7.615 6.068 6.020 2.944

20.57 16.54 12.79 12.96 6.151 2.052

20.30 16.31 12.78 12.92 6.156 2.045

19.85 15.83 12.58 12.77 6.115 2.043

20.02 15.97 12.72 12.62 6.172 2.097

132.4 106.4 82.34 83.41 39.59 13.21 6.435

129.9 104.4 81.79 82.66 39.39 13.09 6.398

131.8 105.0 83.49 84.73 40.58 13.56 6.636

134.5 107.3 85.47 84.79 41.46 14.09 6.718

DECEMBER 201234


CURRENCY RISK ASSESSMENTS

In addition to their central (most likely) forecasts, we askedour panellists for their estimates of the likelihood of alterna-tive rises or declines in certain major currencies over thenext twelve months. This analysis provides a measure ofthe risks attached to consensus central forecasts, and hasallowed us to compile some rough probability distributions

Depreciation vs US$+6% to +19%

Consensus Probability (%) of Currency Depreciation or Appreciation Against the US Dollar

+/- 5%-6% to -19%-20% or moreAppreciation vs US$Currency

Link +20% or more

Survey dateDecember 10, 2012

1 Probabilities are for appreciation/depreciation against the euro

Consensus forecasts are averages of individual panellists’predictions of how a currency is most likely to move over agiven time horizon, but most forecasters would also attachsome probability to various alternative outcomes or sce-narios. This special survey on ‘Currency Risk Assessments’is an attempt to quantify these uncertainties, using ourpanellists’ estimates to produce a number of consensusprobability or risk distributions. The usefulness of this ap-proach is clearly illustrated in the case of pegged or heavilymanaged currencies, like the Chinese renminbi and theVenezuelan bolivar. However, it can also be valuable foridentifying the direction of risk associated with currencyforecasts in countries where valuations are dependent to anextent on unclear global macroeconomic developments orgovernment policy actions. In Latin America, movements inthe Argentinian peso have been restricted by exchange

controls, which included a ban on US dollar purchases forsavings in mid-2012, to curb capital flight. Yet, as can beseen in the table above and chart on next page, highprobabilities are attached to a currency decline of between‘6 and 19%’ (28.8%) and ‘20% or more’ (40%) over the nexttwelve months. These figures partly underline concern thatArgentina might face another financial storm after a recentlegal challenge in the US by holdout creditors to its 2002crisis had raised the immediate threat of default (story onpage 16). Similar fears exist for Venezuela, due to its fragilebalance sheet and the re-election in October 2012 ofPresident Chavez, whose populist policies have under-mined foreign and domestic investment. A dependence onoil, endemic inflation and a lack of fiscal discipline do notbode well for stability in the currency, which has suffered aseries of devaluations over the past decade.

(see below). The charts on page 35 illustrate these 'riskdistributions' for nine of the currencies covered. Apprecia-tions or depreciations refer to changes in the currencyagainst the US dollar, e.g.-20% means a 20% rise in thenumber of currency units per US dollar (except for the UK£,the A$, NZ$ and the euro, which are the reciprocal).

EuroJapanese yenUnited Kingdom poundCanadian dollarSouth African rand

Latin AmericaArgentinian pesoBrazilian realChilean pesoMexican pesoPeruvian solVenezuelan bolivar

Asia/PacificAustralian dollarChinese renminbiHong Kong dollarIndian RupeeIndonesian rupiahMalaysian ringgitNew Zealand dollarPhilippine pesoSingapore dollarSouth Korean wonTaiwanese dollarThai baht

Eastern EuropeCzech koruna1

Hungarian forint1

Israeli shekelPolish zloty1

Russian roubleTurkish Lira

FloatingFloatingFloatingFloatingFloating

FloatingFloatingFloatingFloatingFloatingPegged to US$

FloatingManaged FloatFixed Peg to US$Managed FloatManaged FloatManaged FloatFloatingFloatingFloatingFloatingManaged FloatManaged Float

Managed FloatFloatingFloatingFloatingManaged FloatFloating

6.0 23.4 49.0 16.6 5.05.0 28.2 46.0 16.4 4.44.4 23.2 52.0 16.4 4.06.0 23.4 48.0 18.4 4.27.0 27.0 40.0 21.0 5.0

40.0 28.8 22.0 6.7 2.57.0 21.8 54.0 13.2 4.04.0 16.6 61.4 15.0 3.03.4 12.4 49.0 31.2 4.03.0 8.6 67.0 16.4 5.0

49.0 26.0 20.0 3.0 2.0

5.0 19.0 52.0 21.0 3.02.0 7.7 71.7 16.7 2.01.7 4.0 88.0 4.7 1.74.0 22.3 48.3 21.0 4.35.0 15.0 50.0 25.0 5.05.0 16.7 50.0 23.3 5.05.0 22.0 52.0 18.0 3.05.0 16.7 50.0 23.3 5.05.0 15.0 50.0 25.0 5.05.0 14.3 50.0 25.7 5.05.0 14.7 56.7 18.7 5.05.0 14.7 50.0 25.3 5.0

3.3 13.3 68.3 11.7 3.37.5 20.0 45.0 22.5 5.05.0 15.0 60.0 15.0 5.03.3 16.7 53.3 23.3 3.35.0 20.0 50.0 20.0 5.08.3 18.3 46.7 20.0 6.7

35


DECEMBER 2012

0

10

20

30

40

50

60

70

80

90

100

-20%or

more

-6 to -19%

+/-5% +6 to+19%

+20%or

more

CURRENCY RISK ASSESSMENTS

% change against the US$

Japanese yen UK pound

Venezuela bolivar

Euro

% probability

% probability% probability % probability


Dec. 2013ConsensusForecast =6.196 (-30.7%)





% change against the euro

Argentine peso

Hungarian forint (vs. Euro)

% probability

% probability




% probability

Chinese renminbi

Dec. 2013ConsensusForecast =6.158 (+1.2%)


% probability

Dec. 2013ConsensusForecast =2.057 (+1.1%)

Brazilian real


% probability


Turkish lira

% change against the US$% change against the US$

0

10

20

30

40

50

60

70

80

90

100

-20%or

more

-6 to -19%

+/-5% +6 to+19%

+20%or

more

0

10

20

30

40

50

60

70

80

90

100

-20%or

more

-6 to -19%

+/-5% +6 to+19%

+20%or

more

0

10

20

30

40

50

60

70

80

90

100

-20%or

more

-6 to -19%

+/-5% +6 to+19%

+20%or

more

0

10

20

30

40

50

60

70

80

90

100

-20%or

more

-6 to -19%

+/-5% +6 to+19%

+20%or

more

0

10

20

30

40

50

60

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80

90

100

-20%or

more

-6 to -19%

+/-5% +6 to+19%

+20%or

more

0

10

20

30

40

50

60

70

80

90

100

-20%or

more

-6 to -19%

+/-5% +6 to+19%

+20%or

more

0

10

20

30

40

50

60

70

80

90

100

-20%or

more

-6 to -19%

+/-5% +6 to+19%

+20%or

more

0

10

20

30

40

50

60

70

80

90

100

-20%or

more

-6 to -19%

+/-5% +6 to+19%

+20%or

more

12/2012 FXCF

CONSENSUS ECONOMICS INC.

Established in London in 1989, Consensus Economics prepares monthly compilations of country economicforecasts and topical analyses covering the G-7 Industrialised Nations, Asia Pacific, Eastern Europe andLatin America, as well as specialised publications on Foreign Exchange Forecasts and Energy and MetalPrice Forecasts. Over the past two decades Consensus Economics has cultivated a growing network ofeconomists, drawing upon the expertise of well-established local consultancies and large teams of professionalsin banks who are dedicated to particular countries and regions.

Foreign Exchange Consensus Forecasts® is available at US$798 or £498 or €728 for 12 monthly issues.

For prices and descriptions of all our publications and other regional products and services – including a rangeof electronic delivery options – visit our website: www.consensuseconomics.com, or contact us [email protected].

Consensus Economics Inc.53 Upper Brook Street, London, W1K 2LT, United Kingdom. Tel (44 20) 7491 3211; Fax (44 20) 7409 2331.

Forecast Percentage Changes Against the US$ During the Next Twelve Months

%

-34.0

-32.0

-30.0

-28.0

-26.0

-24.0

-22.0

-20.0

-18.0

-16.0

-14.0

-12.0

-10.0

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

Dec2012

Jan2013

Feb2013

Mar2013

Apr2013

May2013

Jun2013

Jul2013

Aug2013

Sep2013

Oct2013

Nov2013

Dec2013

Chinese renminbi

Russian rouble

Australian dollar

Mexican peso

Ukrainian hryvnia

Venezuelan bolivar

South Korean won

Foreign Exchange Consensus Forecasts by Consensus Economics Inc.

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Transcript of Foreign Exchange Consensus Forecasts by Consensus Economics Inc.