SA current account deteriorates, Senegal’s debt problem

Q2 data this week showed the energy shock is putting South Africa’s current account position under strain, and with oil prices back above $100pb, we expect that external pressure to persist in the near term which may lead to some weakness in the rand. Elsewhere, Senegal is seeking to reprofile its debt, but complex total return swaps, a diverse creditor base and the exclusion of CFA-franc debt raise the risk that relief will be insufficient, with debt distress persisting and growth threatened.