Filtered by Subscriptions: Africa Economics Use setting Africa Economics
Kenya’s current account deficit remains a vulnerability, but we don’t think that it poses a threat to the economy this year. In fact, we think that the deficit will narrow further in 2019 as oil prices fall and railway-related imports decline. … Kenya: …
7th February 2019
The first raft of South African data suggest that growth remained soft going into this year. But we think that growth will pick up later this year as inflation eases and confidence returns. … South Africa: Early signs point to weak start to …
6th February 2019
Kenyan policymakers left their key policy rate unchanged this week, and we think that they will hold rates over the remainder of the year. Peers in Angola and Ghana – who cut this week – will probably continue to loosen policy over the coming months. Next …
1st February 2019
Manufacturing PMIs in South Africa and Nigeria both pointed to weak growth in January. Forward-looking measures, however, support our view that growth in South Africa will pick up later this year. … South Africa & Nigeria Manufacturing PMIs …
Fears that troubles at South Africa’s public power firm will lead to another downgrade of the state’s credit rating seem overdone. Over the long term, however, the utility is not sustainable. Securing the power supply will require further investment, …
31st January 2019
The latest figures suggest that Africa’s key economies stumbled in late 2018 and early 2019. Growth in South Africa probably slowed in the final quarter of last year (though it remained strong by recent standards), while low oil prices and faltering …
30th January 2019
With inflation set to remain within target, we expect that Kenyan policymakers will leave their key rate on hold this year. Their Angolan and Ghanaian counterparts, however, will continue their easing cycles. … Africa rates: Kenya on hold, Ghana & Angola …
28th January 2019
Given Kenya’s fragile external position, plans for more foreign currency debt will increase the economy’s vulnerability to external shocks. Policymakers at the Central Bank of Nigeria showed no sign of shifting their controversial policy stance this week, …
25th January 2019
After a very weak 2018, we expect that growth in Sub-Saharan Africa will strengthen this year. The major oil exporters will, of course, suffer the effects of lower oil prices and our growth forecasts for Nigeria and Angola are below-consensus. But most …
24th January 2019
The sharp fall in South African inflation in December adds to the evidence that the SARB’s much-heralded tightening cycle is now dead in the water. We expect that inflation will remain within target this year, and that attention will soon turn back to …
23rd January 2019
Nigerian policymakers held their key rate at 14.00% today, and reiterated their support for the closely managed FX system. The controversial FX regime will almost certainly remain in place, unless a win for the opposition in next month’s closely-fought …
22nd January 2019
Policymakers in South Africa toned down their hawkish language at their meeting this week, suggesting that rate hikes are now off the agenda. Elsewhere, Nigeria’s leading opposition politician laid out a bold economic reform plan. Given divisions within …
18th January 2019
South African policymakers’ abrupt shift away from their previous hawkish rhetoric suggests that further rate hikes are now unlikely. We think that attention will soon turn to cuts; we expect a 25bp cut in 2020. … South Africa: SARB abandons hawkish …
17th January 2019
November retail sales figures added to the evidence that South Africa’s economy slowed a touch in Q4. But economic growth was robust by recent standards, and we think that conditions will improve in 2019. … South Africa: Slight slowdown in …
16th January 2019
South African output data released this week suggested that the economy slowed a touch in Q4. Even so, growth was still pretty strong by recent standards. Elsewhere, a coup attempt in Gabon revived memories of Africa’s chaotic 1970s. But such crises are …
11th January 2019
November’s slowdown in manufacturing growth supports our view that GDP growth eased in Q4 after a very strong Q3. But activity still remained strong (by local standards) and we think that headline growth will accelerate in 2019. … South Africa …
10th January 2019
Figures released in Kenya this week have strengthened our view that the country will be one of Africa’s fastest-growing economies of 2019. Meanwhile, the settlement between South African telecoms giant, MTN, and the Nigerian authorities has calmed …
4th January 2019
Strong growth in Q3 and the recent fall in oil prices suggest that Kenya’s economy will perform well going into 2019. Despite lingering structural problems, we’ve raised our growth forecast for this year. … Kenya: Solid momentum, low oil prices boost …
3rd January 2019
Nigerian President Muhammadu Buhari laid out his 2019 budget proposal this week, emphasising that he plans to keep key policies unchanged if he is re-elected in February. A big bank merger in the country has prompted fears of instability in the sector, …
21st December 2018
Figures released this month showed that Sub-Saharan Africa’s largest two economies remained weak in late 2018, but that activity picked up faster elsewhere in the region. These readings strengthen our view that Africa’s smaller economies will continue to …
20th December 2018
President Muhammadu Buhari’s 2019 spending plan would cut the federal deficit and leave key policies unchanged. Given political uncertainties, however, today’s speech is a poor guide to policy outcomes. … Nigeria: President Buhari promises policy …
19th December 2018
Angola’s $3.7bn deal with the IMF adds to the evidence that President João Lourenço is making a real shift towards more orthodox policymaking and while growth will stay weak in the near-term, economic reforms will help to improve the country’s long-term …
14th December 2018
Retail sales figures released today add to the evidence that South Africa maintained robust growth at the start of Q4. Inflation remained high in November, suggesting another rate hike in Q1 2019. … South Africa: More signs of strong start to …
12th December 2018
Activity data for October suggest that South Africa’s economy retained the momentum it picked up in Q3. Even so, we retain the view that growth will probably slow over the coming months. … South Africa: Activity data points to strong start to …
11th December 2018
The move towards land expropriation without compensation in South Africa has prompted fears of a Zimbabwe-style ‘land grab’. But examples from Asia show that land reform can be a success. … South Africa land reform: More Taiwan than …
10th December 2018
Nigeria’s economy accelerated very slightly in Q3, but conditions remained very weak. Headwinds, including low oil prices, are still building, adding to the downside risks to our view that growth will accelerate in 2019. … Nigeria GDP …
An opaque out-of-court settlement between Nigeria’s government and MTN would do little to improve perceptions of the country’s business environment. Elsewhere; South Africa’s economy returned to growth in Q3, but recent developments suggest that …
7th December 2018
The larger-than-expected South African current account deficit in Q3, of 3.5% of GDP, adds to the reasons to think that the Reserve Bank will tighten monetary policy a little further in the next few months. … South Africa Current Account …
6th December 2018
South Africa’s economy escaped recession in Q3, and the rebound was much stronger than we’d expected. But growth will probably soften in Q4 due to weaker agricultural growth and the imposition of power cuts by the troubled state electricity firm. … South …
4th December 2018
The rebound in South Africa’s manufacturing PMI to 49.5 in November is the latest sign that the economy is now recovering following a very weak performance earlier this year. Even so, we think that many analysts are too optimistic about the prospects for …
3rd December 2018
Lower oil prices will batter Africa’s big oil exporters. But they will benefit Africa’s oil importers, which make up the majority of the region’s GDP. Lower petrol prices will, for instance, sap inflation in South Africa – supporting our view that …
30th November 2018
The recent sharp fall in oil prices will add to headwinds facing the economies of Nigeria and Angola. We estimate that both country’s export revenues will have fallen by about a US$1bn over the past month. This will provide a big hit to government …
29th November 2018
African economies will probably remain among the fastest-growing in the world over the coming decades. But slow productivity growth will prevent convergence with high income countries. Indeed, we expect that Africa will fall further behind other …
It is very unlikely that the new Nairobi-Mombasa railway will, as Kenya’s government hopes, break even next year. But fears that the troubled line will push up to Kenya’s debt repayment costs are misplaced. … Kenya’s railway: Trouble ahead, but limited …
28th November 2018
Kenyan policymakers left their key policy rate at 9.00% today, and we think that they will maintain the current policy stance going into next year. … Kenya: Rates on hold into …
27th November 2018
Hawkish rhetoric from South Africa’s MPC suggests that another rate hike is likely in Q1. But the divided MPC’s appetite for further tightening will dissipate if – as we expect – inflation eases in mid-2019. Tanzania’s president continued his run of …
23rd November 2018
Hawkish rhetoric suggests that policymakers at the SARB will follow today’s 25bp rate hike with another rate rise in Q1. But we think that inflation will soon peak, and that rates will ultimately fall in 2020. … South Africa: SARB hikes, but cycle will …
22nd November 2018
Last month’s rise in South African inflation was almost entirely due to fuel prices, so we still expect that the SARB will keep its key rate unchanged at its meeting tomorrow. … South Africa CPI …
21st November 2018
Africa’s failure to develop export-orientated manufacturing sectors is holding back economic development across the region. We expect that this will remain a key weakness over the long term. Even in Ethiopia, which is often seen as a manufacturing …
20th November 2018
South Africa’s government has taken a big step towards the expropriation of land without compensation, but fears that land reform will disrupt the economy are overblown. Meanwhile, given weak economic growth and fading inflationary pressures, we think …
16th November 2018
The Bank of Uganda will probably buck the regional trend next year by tightening policy further in response to a widening current account deficit. This will add to headwinds for economic growth. … Uganda: Policy tightening to add headwinds to …
15th November 2018
September activity data released over the past week has been pretty downbeat. But conditions still seem to have improved in recent months, supporting our view that the economy returned to growth in Q3. … S. Africa: Economy probably escaped recession in …
14th November 2018
The raft of survey releases in South Africa this week provided contradictory messages, but on balance we think that conditions continued to improve at the start of Q4. Meanwhile, the news that the Mozambican government is closing in on deals to …
9th November 2018
South African manufacturing and mining data for September released today support our view that the economy pulled out of recession in Q3, but that growth was very weak. … South Africa Manufacturing & Mining Output …
8th November 2018
The Mozambican government’s preliminary agreement to restructure its eurobond looks like an important first step out of its long-running debt saga. But even if this goes ahead, significant fiscal tightening and a restructuring of bilateral and …
6th November 2018
Kenya’s plans for another US$2.5bn eurobond have added to our concerns about its burgeoning public debt. While a major debt crisis should be avoided if the country’s economy continues to grow rapidly, we are increasingly concerned that an external shock …
5th November 2018
Activity data released this week supported our view that economic conditions in Nigeria and South Africa were very weak in recent months. We think official GDP figures due out in late November and early December will show that both economies posted tepid …
2nd November 2018
The fall in South Africa’s manufacturing PMI is probably overestimating the weakness of the manufacturing sector, which we think continued to recover in October. Flattering base effects created by the recent recession mean that even a poor performance …
1st November 2018
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 …
31st October 2018
Policymakers in South Africa and Nigeria both laid out fiscal plans this month, but their responses to weak revenues were very different. South Africa’s new finance minister announced a wider deficit in 2019, while Nigerian officials promised to cut …
30th October 2018
