We expect Nigeria’s central bank to follow up its underwhelming 25bp interest rate hike this week, with more aggressive action at the next meeting as inflation should have risen sharply. Still, a downside risk is that MPC members appear to be putting undue focus on growth over their inflation mandate. In contrast Ghana's 50bp hike was an aggressive surprise. We see this a one-off, as tighter fiscal policy and a stronger currency will drag inflation down. Finally, Niger’s coup could hurt its uranium industry, which is important to the European nuclear industry. The coup also fits into a trend of growing political instability in the Sahel, although it's worth contrasting that with much stronger institutions in some of the region’s larger economies.
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