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Welcome to Factal Forecast, a look at the week’s biggest stories from the editors at Factal.
We publish our forward-looking note each Thursday to help you get a jump-start on the week ahead.
Protests in France over a controversial pension reform plan heated up this week after President Emmanuel Macron’s government survived two no-confidence votes. In this week’s Factal Forecast podcast, Senior Editor Jimmy Lovaas and Editor Jessica Fino discuss why the protests are likely to continue despite hundreds of arrests and what’s next for the plan to raise the retirement age.
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Week of March 24-31
A Look Ahead
March 24 – Euro Summit
Beginning Thursday, the European Council will meet for a summit in Brussels with heads of states from all EU countries in attendance.
What’s happened so far
European leaders will primarily discuss how to boost the union’s economy, as well as its competitiveness globally. Following the short financial scare directly after Silicon Valley Bank’s demise, some reforms may include easing access to financial aid from states, creating banking unions and finding other ways to tackle the United States’ Inflation Reduction Act. Ukraine will undoubtedly be discussed, as UN Chief Antonio Guterres has been invited to attend the summit after the EU agreed to send one million rounds of artillery shells to Ukraine through its varying defense funds.
The impact
While the main points will focus on the EU’s immediate economic and financial future, the continent’s leaders are also set to decide what form continued military aid to Ukraine should take. It is yet to be seen what kind of decisions, if any, will be made on improving competitiveness and the economic situation Europe finds itself in, and whether or not there are issues underlying military aid to Ukraine.
March 26 – Kyiv shortens curfew
Starting Sunday, Ukrainian authorities will further shorten the amount of time citizens in Kyiv will have to curfew, ordering it from 11 p.m. to 5 a.m.
What’s happened so far
The curfew in Kyiv was initially put in place immediately following Russia’s full invasion of Ukraine more than a year ago. As Moscow’s Kyiv offensive applied heavy pressure to the city, authorities mandated a 5 p.m. to 8 a.m. daily curfew. Curfew hours have since been steadily relaxed in the wake of Russia’s doomed Kyiv offensive, with the latest liberalization coming just days prior to the one-year anniversary of Russia announcing its full withdrawal from northern Ukraine.
The impact
Shortening the curfew moves Kyiv closer to relative normalcy one year after Russia’s brutal offensive threatened the city and allows for increased public transportation and commerce. It could also entice Ukrainian refugees to return to Kyiv. Russia’s invasion precipitated the largest refugee crisis in Europe since World War II. While nearly 20 million people initially fled Ukraine, approximately 11 million have since returned as Russia’s invasion faltered and fighting became concentrated in the south and east. While Kyiv and western cities remain vulnerable to relatively consistent missile barrages, moves to return to more normalcy could initiate more returns from the 8 million refugees that remain in Europe.
March 26 – Cuba parliamentary elections
Cuban voters will participate in largely symbolic one-party elections Sunday to choose the country’s National Assembly of People’s Power.
What’s happened so far
Cuba’s election system is largely predetermined, with Freedom House giving the country a 1 out of 40 possible points for political rights. Roughly half of the 470 National Assembly candidates are chosen by local workers’ collectives. Under the 2019 constitution, assembly members then choose the president, who in turn chooses the prime minister. Miguel Diaz-Canel was nearly unanimously voted in as president to succeed Raul Castro in 2019, and his Prime Minister Manuel Marrero was quickly confirmed.
The impact
Turnout in November 2022’s municipal elections was the lowest in 40 years following opposition campaigns to boycott the process. Many Cubans believed the resignation of Fidel Castro’s brother Raul would bring about greater democracy through the 2019 constitution. Despite this, Diaz-Canel will likely be reelected president. Cuba’s economy has struggled since the beginning of the coronavirus pandemic, with record numbers of emigration and inflation in the triple digits. The Cuban opposition has not called for a boycott, but general dissatisfaction with the country’s economy could spark backlash in terms of rare protests or low turnout.
March 26 – Kamala Harris visits Africa
U.S. Vice President Kamala Harris will commence a three-nation tour of Africa on Sunday as the United States seeks to further demonstrate its support for a region heavily under Chinese influence.
What’s happened so far
Harris is the fourth high-level U.S. official to visit the African continent in 2023, following trips by first lady Jill Biden, Treasury Secretary Janet Yellen and Secretary of State Antony Blinken. President Joe Biden is also expected to visit the region later this year. Harris will begin her trip in Ghana, staying through March 29 before traveling to Tanzania through March 31 and ending in Zambia through April 1.
The impact
Along with meeting the leaders of all three nations, Harris will engage with private sector projects supporting the digital economy, climate change resilience and women’s economic empowerment, according to her press secretary. Ending the trip in Zambia is a symbolic move, as the United States is particularly concerned about $6 billion the country owes to China — Harris is likely to build on Yellen’s progress on debt negotiations made during her trip in January.
March 26 – Brazil’s president visits China
Brazilian President Luiz Inacio Lula da Silva will visit Beijing and Shanghai starting Sunday.
What’s happened so far
The Brazilian president will meet his Chinese counterpart Xi Jinping on Tuesday to discuss bilateral trade, investment and the war in Ukraine, amid a push from Lula to position Brazil as a mediating nation in the conflict. During his visit, Lula will also attend the appointment of the new BRICS Bank president. Former President Dilma Rousseff has been proposed by his government as a candidate to lead the group formed by Brazil, Russia, India, China and South Africa.
The impact
Brazil’s president will be accompanied by a delegation of government officials and 240 business representatives, including agriculture sector representation. Chinese and Brazilian officials have expressed interest in reinforcing the already strong commercial ties between both countries first established during Lula’s term in 2009. China is currently Brazil’s most important trading partner, followed by the United States. Lula’s visit to China follows his February trip to meet U.S. President Joe Biden as part of the new administration’s efforts to restore diplomatic relations and neutrality following Jair Bolsonaro’s rule.
March 27 – Hungary’s legislature votes on Finland’s NATO accession
Hungary’s ruling party said it will approve Finland’s membership into the military alliance Monday, ending a process that began when Russia invaded Ukraine last year.
What’s happened so far
Since the breakup of the USSR, the Finnish people have historically been opposed to joining NATO as a way to stay neutral and not provoke Russia, with which it shares an 830-mile border. It progressively gotten cozier with NATO, including military purchases and joint exercises, but the invasion of Ukraine pushed Finland, along with Sweden, to apply for membership. Since then, Hungary and Turkey have held up the process over arms exports, support for Kurdish groups and “outright lies” about democracy. Over the past few months, negotiations moved forward and the countries agreed to let Finland in.
The impact
The process to let Finland into NATO has gone fairly quickly. However, things have not gone as smoothly for Sweden. Turkey’s president recently praised Finland for “authentic and concrete steps” while criticizing Sweden. That being said, there is optimism Turkey and Hungary will give Sweden the green light after elections and before July’s summit in Lithuania.
March 29 – Fed, FDIC officials to testify on recent bank failures
The U.S. House Financial Services Committee will hold its first hearing on the second-and-third largest bank failures in U.S. history Wednesday, with FDIC chairman Martin Gruenberg and Federal Reserve vice-chair Michael Barr scheduled to serve as witnesses.
What’s happened so far
Silicon Valley Bank and Signature Bank became the largest banks to fail in the United States since 2008 this month, shaking up not only the startups who made up much of Silicon Valley Bank’s customer base, but also markets across the world. U.S. federal regulators announced soon after that they would guarantee the full value of deposits made at both banks, regardless of whether they passed the usual $250,000 threshold. The Justice Department and the Securities and Exchange Commission have reportedly launched two separate inquiries into Silicon Valley Bank’s collapse.
The impact
The Senate banking committee is also expected to hold a hearing soon that will also bring in regulators as witnesses. Congressional lawmakers remain divided on how to address the bank failures. Democrats are calling for banking regulations to be strengthened, but Republicans say existing oversight mechanisms should have been enough, blaming regulators for being “asleep at the switch” and blaming Democrats for higher inflation.
March 30 – Pakistan court summons Imran Khan
A Pakistani court in Islamabad has summoned former Prime Minister Imran Khan to appear before a judge Thursday over charges he sold state gifts while in office.
What’s happened so far
The summon comes after police arrested dozens of Khan’s supporters following multiple days of clashes outside his Lahore residence during an attempted arrest raid last week. His supporters later clashed with police in Islamabad, too, as he arrived to make an official court appearance. The former premier blamed the government for not providing adequate security for him to appear for his court proceedings and says there is an active threat to his life.
The impact
The clashes between police and Khan’s supporters have brought chaos to the country which is already facing a worsening economic crisis. Khan has alleged that the current administration and the military establishment are using the court cases to prevent him from participating in the next elections in November.
What Else Matters
Possible Trump indictment
New York City authorities have been on edge this week ahead of a potential indictment of former President Donald Trump, who faces possible criminal charges related to a “hush money” payment made by his lawyer Michael Cohen to porn star Stormy Daniels during the 2016 election campaign. Trump, for his part, has denied any wrongdoing and, on Saturday, urged his supporters to protest his arrest that he expected would come this week. So far, there has been no indication from the Manhattan grand jury or the district attorney that the years-long investigation is at its end, and the jury met Monday this week without releasing any public statements. The panel is expected to meet again on Thursday.
Watch for: No former or current U.S. president has ever been charged with a crime, and Trump’s potential arrest marks an unprecedented moment in American history. Trump posted on his Truth Social account this past weekend that he expected to be arrested as early as Tuesday, though his attorney told CBS News that the former president was only speculating on the Manhattan DA’s plans. Trump urged his supporters to “protest” and “take our nation back” in response, though demonstrations so far have been relatively quiet. All NYPD officers, including plainclothes investigators, were ordered to wear their uniforms starting Monday as the agency braced for unrest. Barricades were erected outside Trump Tower in Midtown Manhattan and around the court downtown, and U.S. Capitol police put up fencing around the Capitol complex in Washington, D.C. Trump’s supporters, however, seem wary of the calls to protest, with online chatter suggesting many fear it’s a “trap” by the federal government to arrest them.
French protests
France continues to be in the spotlight as President Emmanuel Macron’s government advances its effort to introduce a pension system reform. On Monday, violent protests erupted after two votes of no-confidence against the government failed and the parliament formally adopted the controversial pension reform. Under the current plan, which is backed by Prime Minister Elizabeth Borne, the retirement age would rise from 62 to 64 and workers would be forced to contribute for an additional year.
Watch for: Significant disruptions are expected for France’s national company SNCF as another day of strike action gets underway Thursday. Public transportation will be particularly affected across Île-de-France, which includes Paris. Violent clashes between protesters and police are expected to continue. On Monday alone, more than 280 people were detained across the country, with 234 arrested in Paris. Meanwhile, opposition parties are determined to prevent the reform, with some of the options including an appeal to the Constitutional Council and a referendum on the issue. While Macron has argued the reform is “necessary” to balance the country’s accounts, his efforts caused him a big drop in popularity, with a recent poll indicating 70 percent of the respondents saying they are dissatisfied with the president.
Extended Outlook
What’s on our radar in the coming weeks…
March 24-31
March 24
- Euro Summit
March 25
- New South Wales state election
March 26
- Turkmenistan National Assembly election
- King Charles visits France
- Cuban National Assembly of People’s Power election
- Brazil’s president visits China
- VP Harris visits Africa
March 27
- Malaysian prime minister Anwar Ibrahim visits Cambodia
- Hungary’s legislature votes on Finland’s NATO accession
March 28
- Brazil’s President Luiz Inacio Lula da Silva to meet Chinese President Xi Jinping
- ASEAN+3 Finance and Central Bank Deputies’ meeting
March 29
- Nigeria census
- Azerbaijani Foreign Minister Jeyhun Bayramov to visit Israel
- Fed, FDIC officials to testify on recent bank failures
March 30
- Palestine Land Day
- Pakistan court summons Imran Khan
March 31
- Oscar Pistorius parole hearing
April 1-7
April 2
- Bulgaria elections
- Finnish parliament election
- Andorra parliamentary elections
- Montenegro election runoff
April 3
- British passport officers begin five weeks of strike action
April 4
- NATO foreign ministers to meet in Brussels
April 5
- Passover begins
April 8-14
April 9
- Easter
April 11
- French President Emmanuel Macron makes a state visit to the Netherlands
April 15-21
April 17
- Boston Marathon
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Top photo: Two people walk their dog in Odesa, Ukraine, in April 2022. Streets in Ukrainian cities are a juxtaposition of normal life continuing on amid war and curfews. (Photo: IMF Photo/Brendan Hoffman)
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