1. For the first time in more than a decade, the US Federal Reserve (Fed) cut the policy interest rate by 25 basis points.

While the cut was widely expected, the market was disappointed by the reference to the rate as a ‘mid-cycle adjustment’ and not likely the beginning of a prolonged easing cycle.

However, the Fed did concede that uncertainties remain, leaving the door open to rate cuts in the future.

We believe the Fed’s rate cut could help extend US growth longer and will likely be positive for emerging markets overall, given the importance of the US economy as a growth driver.

2. Brazil’s lower house of Congress overwhelmingly approved a landmark pension reform bill in July, a positive step in a process that should substantially shore up the country’s fiscal situation.

While it still needs a full congressional vote, we think this is a positive development.

Savings from the reform are expected to reach $235bn over the next 10 years. After the approval of the pension system reform, we expect tax reform to come next, along with privatisations and more microeconomic reforms aimed at improving Brazil’s regulatory environment.

3. India’s budget for fiscal year 2019/20, which aims to give the economy a boost via tax cuts and other measures to stimulate foreign investment, was released in July.

With the elections behind us, we expect market focus to shift to the fundamentals, such as earnings growth, inflation and fiscal prudence.

The risks we currently see are related to global factors, such as trade tensions, US monetary policy and rising oil prices. However, rising domestic consumption has tilted India’s economy to be less reliant on the export sector, which makes India less vulnerable to adverse global factors.

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