SA manufacturing sector one of the worst hit across EMs

Hard activity data from South Africa confirm that the economy has been among the hardest hit across major EMs by the coronavirus crisis and, while the lockdown has been eased in recent months, we think that the recovery will be a lot weaker than most currently expect.
Virag Forizs Emerging Markets Economist
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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

More from Virag Forizs

Africa Data Response

Nigeria Consumer Prices (May)

The second consecutive drop in Nigeria’s headline inflation rate, to 17.9% y/y in May, will probably go some way towards easing policymakers’ recent concerns about high and rising inflation. While we expect inflation to remain well above the central bank’s target for the foreseeable future, the MPC is likely to keep interest rates unchanged over the coming years.

15 June 2021

Africa Economics Focus

The perils of deficit monetisation in Nigeria

Nigeria’s government has turned to the central bank to plug ever larger budget deficits in recent years and policymakers are unlikely to kick their deficit monetisation habit, particularly if the fiscal position worsens next year (as we expect). This will deepen some of Nigeria’s existing economic woes, including high inflation, downward pressure on the naira and weak economic growth.

14 June 2021

Africa Economics Weekly

Filling gaps: vaccine supply in SSA & electricity in SA

Leaders of G7 nations meeting this week are ramping up efforts to provide more vaccines to the developing world, which – along with the prospect of larger supplies from China – could give a lift to struggling inoculation campaigns and economic recoveries in Africa. Meanwhile, South Africa announced further steps to address its chronic electricity supply problem that has long weighed on the economy, but the measures will probably take some time to bear fruit.

11 June 2021
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