Ghana and Zambia still in the firing line

In line with the general rally in EM financial markets over the past couple of months, the South African rand has posted significant gains against the US$ of late. But the rally has not spread to a number of other economies in sub-Saharan Africa. In particular, investor sentiment towards countries that have seen a significant deterioration in their budget and current account positions over the past few years continues to sour. Indeed, the Ghanaian cedi and Zambian kwacha have continued to slump so far in May, with both currencies falling to fresh record lows against the US$.