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SARB: Window for a cut closed, rates will be on hold

Given policymakers’ decision to keep their key rate on hold at 6.50% today, we now think that South African interest rates will remain unchanged over the coming quarters. Policymakers do not seem inclined to take the opportunity to boost the economy, and their window for doing so has now closed.
John Ashbourne Senior Emerging Markets Economist
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Africa Economics Update

Ethiopia: Unlikely to replicate exceptional growth again

Ethiopia has been grappling with the fallout from its internal conflict and severe drought which, coming alongside spillovers from the war in Ukraine, will result in much weaker growth in the coming years and a sovereign debt restructuring is likely. Over the medium-term, we're doubtful that the government will be able to push through its ambitious reform agenda. Ethiopia’s growth miracle, in which the economy grew at rates of 8-12%, has come to an end.

10 August 2022

Africa Economics Weekly

Zambia’s creditors pledge debt relief, Kenya’s elections

News that Zambia’s official creditors agreed to provide debt relief is certainly encouraging and will unlock IMF funding. But the terms of the deal remain unknown, leaving in doubt that the country’s public debt will return to a sustainable path. Meanwhile, investors are on tenterhooks just as much as Kenyan voters ahead of Tuesday’s elections that are shaping up to be a close race. Oil and the Gulf Drop-In (9th Aug): What’s the outlook for oil prices and what does that mean for Gulf economic outperformance? Join economists from our Commodities and Emerging Markets teams for this 20-minute briefing. Register now.

5 August 2022

Africa Economics Update

Kenya: elections no cure for economic woes

Kenya’s general election scheduled for Tuesday is set against a challenging economic backdrop, and no matter the winner, the country’s outlook is likely to remain overshadowed by large macroeconomic imbalances and high public debt risks. Oil and the Gulf Drop-In (9th Aug): What’s the outlook for oil prices and what does that mean for Gulf economic outperformance? Join economists from our Commodities and Emerging Markets teams for this 20-minute briefing. Register now.

5 August 2022

More from John Ashbourne

Africa Economics Weekly

Tumbling rand, coronavirus containment, default risks

The current risk-off sentiment means that the South African rand’s slide this week will probably continue in the near term. And escalating containment measures will take an economic toll, despite worries about their effectiveness. In the meantime, the coronavirus and low commodity prices are putting pressure on most African economies’ balance of payments positions and pushing many sovereigns closer to default.

3 April 2020

Africa Data Response

South Africa Manufacturing PMI (Mar.)

South Africa’s PMI jumped in March, but only due to a statistical quirk in the compilation process. The underlying data suggest that the economy was, in fact, weakening even before the recent lockdown.

1 April 2020

Africa Economics Update

S. Africa: Anticlimactic downgrade tells us little new

Given the scale of ongoing global market turbulence, Moody’s decision to strip South Africa of its last investment grade rating will have less immediate effect than some had feared. That said, the country’s already grim debt outlook has deteriorated significantly given the sharp fall in GDP likely this year.

30 March 2020
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