Kenya & Uganda: Inflation will remain within target

Price pressures eased in Kenya and Uganda in October, and we think that inflation will remain within target in both countries. Kenyan policymakers will probably keep their key rate on hold in 2019, while their Ugandan peers will hike rates once more in response to a widening current account deficit.
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Africa Economics Weekly

Recoveries trembling under new virus variant threat

A concerning new virus variant identified in Southern Africa has already prompted the re-imposition of restrictions on travellers from the region and triggered a flight to safety in global financial markets. A tightening of local containment measures is likely to follow, dampening economic activity, and the threat of a new virus wave will linger.
Drop-In: The B.1.1.529 strain – The economic and markets impact 10:00 ET/15:00 GMT, Friday 26th November Group Chief Economist Neil Shearing will be joined by senior economists from across our services at 10:00 ET/15:00 GMT today to give their views and answer your questions about the potential economic and markets impact of this new virus strain. Click here to register and to submit your questions ahead of the session. 

26 November 2021

Africa Economics Update

CBN maintains interest rates, but hints at policy shift

The Central Bank of Nigeria kept its benchmark rate on hold at 11.50% today, but the statement signalled that monetary policy normalisation is now on the horizon. While we don’t expect interest rates to be raised imminently, we have pencilled in 200bp of hikes over 2022-23.

23 November 2021

Africa Economics Weekly

African central banks and the EM rate hike club

This week, the South African Reserve Bank joined its EM counterparts in tightening monetary policy, but we don’t think that policymakers in South Africa will raise interest rates as aggressively as central banks across Emerging Europe and Latin America. Elsewhere, a further fall in inflation last month and soft Q3 GDP figures mean that Nigeria’s central bank is unlikely to join the EM rate hike club any time soon.

19 November 2021

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Commodities Weekly Wrap

Middle East tensions back in the spotlight

Having surged this week, the price of oil could rise further in the near term if tensions between Iran and the US continue to escalate. At the same time, the price of gold is benefitting from an increase in safe-haven demand and a weaker US dollar. The prices of most industrial commodities also rose this week as both the Fed and the ECB signalled looser monetary policy and President Trump announced that he would meet with President Xi on the sidelines of the G20 meeting. Markets will be closely watching events in the Gulf over the next few days. Elsewhere, the G20 summit in Osaka, Japan, gets under way on Friday and all eyes will be on the Trump-Xi meeting. Even if some sort of trade agreement is reached between the two leaders, we do not think it will last. A deal which would be acceptable to both sides appears increasingly remote. We suspect that by early next year, nearly all of China’s exports to the US will be subject to tariffs. Finally, the biannual OPEC and OPEC+ meetings that had been scheduled for next week have been postponed until 1st-2nd July, reportedly because Russia was keen that the meetings be held after the G20.

21 June 2019

Capital Daily

Market reaction to US-Iran tensions likely to remain contained

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21 June 2019

Africa Economics Weekly

Easing cycle gains momentum, no news from SONA

Inflation figures released in South Africa and Nigeria this week supported our view that policymakers in both countries will loosen monetary policy later this year. Rates elsewhere are already falling; the Bank of Mozambique cut by 25bp this week. President Cyril Ramaphosa’s State of the Nation Address was disappointingly light on substance, suggesting that divisions within the ANC are hobbling policymaking.

21 June 2019
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