In Q3 South Korea’s economy grew at the fastest pace in seven years. GDP increased 2.9% and may exceed 5% growth in Q4 due to the improvement in business conditions in China. Capital investment in factories in Korea shot up 8.9% in the third quarter. Accordingly, the South Korean central bank may soon become the second bank in the G20 to raise interest rates.
 
The International Monetary Fund now judges that countries in Latin America have recovered well enough to start dismantling their stimulus programs. The IMF forecasts that the region will expand by 2.9% in 2010, after a 2.6% decline this year.
 
On the other hand, we think Russia has problems that won’t be solved by $80 oil. Standard & Poor’s characterized Russian banks as “very high risk on a global comparison” in a recent report. Moody’s estimates that the share of problem loans may rise to 25% of total lending by the end of next year, double current levels. According to President Medvedev, the Russian economy is at risk of contracting 7.5% this year.