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The pick-up in South Africa’s manufacturing PMI for July supports our view that the economy will strengthen in the second half of this year. … South Africa & Nigeria Manufacturing PMI …
1st August 2018
Data released in July revealed a wide-spread economic slowdown across most of Sub-Saharan Africa. The available figures mostly suggest that conditions improved more recently, but that growth remained weak in the middle of the year. … Recent weakness …
31st July 2018
The statement that accompanied today’s decision by the Central Bank of Kenya to lower interest rates by 50bp suggested that the easing cycle has further to run. However, with inflation set to rise in the coming months, the next cut in rates is likely to …
30th July 2018
The available evidence suggests that fears of a pre-election surge in Nigerian inflation are misplaced. Elsewhere, we doubt that violence will derail gas investment in Mozambique and expect that President Emmerson Mnangagwa will win next week’s election …
27th July 2018
Widespread fears that Nigeria’s upcoming election will spur inflation are not supported by the available evidence. We think that price pressures will continue to ease over the rest of this year. … Nigeria: Pre-election inflation fears …
25th July 2018
Nigeria’s MPC left its key rate on hold at 14.00%, and hawkish language has led us to remove the rate cuts that we’d previously pencilled in for Q4. Confusingly, the governor also announced unorthodox policy tools to loosen credit conditions, which will …
24th July 2018
Inflation in Nigeria slowed in June, and we think that it will continue to ease over the coming months. While policymakers will keep their key rate on hold tomorrow, they will probably cut later this year. … Nigeria Consumer Prices …
23rd July 2018
South African activity data out this week supported our view that the economy strengthened in the middle of Q2. Even so, growth will probably disappoint over 2018 as a whole. Elsewhere, Abuja’s efforts to re-launch Nigeria Air threaten to burden the …
20th July 2018
South African policymakers adopted even more hawkish language at today’s MPC meeting, but we still doubt that they will hike rates in 2019. The risks to our non-consensus view are, admittedly, growing. … SA: SARB talks tough, but rate hikes still …
19th July 2018
Kenya’s wide current account deficit will narrow in 2019 as oil prices decline and food imports fall. But the situation will remain fragile; we think that economic growth will be softer than most expect, and that the shilling will weaken against the US …
Today’s unexpectedly strong retail sales figures add to the evidence that South Africa’s economy improved in the middle of Q2. The contraction seems to have bottomed out in April. … South Africa: Retail sales suggest improvement in …
18th July 2018
June’s softer-than-expected inflation print supports our view that fears of a rate hike are misplaced. We think that the SARB will keep policy on hold this year, before cutting its key interest rate in 2019. … South Africa CPI …
Survey and output figures released this week suggested that conditions in Nigeria and South Africa improved in Q2. South African retail sales figures out next week will probably provide more evidence of a modest recovery. We think that the SARB will keep …
13th July 2018
Surprisingly positive figures from the mining and manufacturing sectors suggest that South Africa’s economy improved a bit last quarter. Even so, GDP probably continued to fall. … South Africa: Contraction eased in middle of …
12th July 2018
Economic growth in Sub-Saharan Africa will probably strengthen over the second half of 2018, but we think that the consensus view that this year’s performance will mark the start of a multi-year acceleration is overly optimistic. Although most EM central …
The latest drop in the SACCI Business Confidence Index strengthens our view that South Africa’s economy remained weak in Q2. … South Africa SACCI Business Confidence …
10th July 2018
Recently-released figures have supported our view that Kenya’s economy will strengthen this year. Conditions elsewhere, however, seem to have deteriorated. And we think that next week’s data will throw cold water on hopes that South Africa’s economy …
6th July 2018
After contracting in Q1, the latest figures suggest that South Africa’s economy remained very weak in Q2. As a result, we’ve cut our 2018 GDP estimate from 2.0% y/y to a below-consensus 1.3%. … South Africa: The Ramaphosa …
4th July 2018
The fall in South Africa’s manufacturing PMI for June provides further evidence that the slump in the economy seen in Q1 was followed by further weakness in Q2. … South Africa Manufacturing PMI …
2nd July 2018
This week’s South African employment figures were less positive than they appear at first glance. Elsewhere, official economic growth slowed in Ghana in Q1. New poverty estimates caused a storm in Nigeria, where policymaking is taking a populist turn in …
29th June 2018
After a painful adjustment, growth in the Central African franc zone will pick up in 2018 and 2019. The region’s longer-term outlook, however, is poor. Indeed, tensions between Cameroon and its more oil-dependent neighbours may eventually threaten the …
28th June 2018
Figures released over the past month confirmed that Africa’s larger economies have all struggled in 2018. South Africa, where GDP actually fell in Q1, was the worst performer. Elsewhere, figures from Nigeria, Angola, Kenya, and Côte d’Ivoire all suggest …
27th June 2018
Market fears that South African policymakers will hike interest rates in response to a weak rand are overdone. We think that the SARB’s repo rate will be held at 6.50% for the rest of this year. … S. Africa: Why the SARB will look through rand …
26th June 2018
Markets are getting ahead of themselves by pricing in rate hikes in South Africa. Policymakers have explicitly said that they will not react to currency moves until they see a lasting effect on domestic inflation, which actually eased last month. We …
22nd June 2018
After widening in Q1, South Africa’s current account deficit will likely narrow later this year. The deficit strengthens calls for a rate hike, though we maintain that the SARB will leave rates on hold in 2018. … South Africa Current Account …
21st June 2018
South African inflation eased slightly in May, which should reduce speculation that the SARB will hike rates in the coming months. We think that policymakers will keep rates on hold, before cutting in 2019. … South Africa CPI …
20th June 2018
Inflation in Uganda will accelerate over the coming months, but remain below the highs recorded last year. Policymakers will probably leave rates on hold this year, but restart their easing cycle in 2019. … Uganda: Inflation to be contained this …
18th June 2018
Kenyan policymakers’ plan to narrow their budget deficit relies on very optimistic revenue forecasts. If these are missed, concerns about Kenya’s large and growing debt burden will increase. … EAC Budgets: Kenyan fiscal policy raises economic …
15th June 2018
Today’s mining figures confirmed that, following a disappointing Q1, South Africa’s economy weakened even more at the start of the Q2. We still think that the economy will strengthen this year. … South Africa: Weak start to …
14th June 2018
Inflation figures released today by Nigeria, Ghana, and Angola were all weak by recent standards. We think that policymakers will continue their easing cycles in late 2018 and early 2019. … West Africa: Easing cycles will …
13th June 2018
After a difficult period, recent data show that Ghana’s balance sheet problems are now behind us. While problems in the banking sector have emerged, policymakers are taking the right steps to tackle them. … Ghana: Balance sheet weaknesses …
8th June 2018
South Africa’s manufacturing sector strengthened in April, but a key portion of the industry continued to contract. In q/q terms, growth was actually weaker than in Q1. … South Africa Manufacturing …
7th June 2018
Reforms announced by Ethiopia’s government could upend the country’s political and economic model. This may eventually boost growth, but a delicate period of liberalisation will increase the risk of near-term shocks. We think the move springs from elite …
South Africa’s economy contracted again in Q1, underlining the scale of the task facing President Ramaphosa. Growth will pick up later this year, but will remain weak by historical standards. … South Africa: ‘Ramaphoria’ stalls in …
5th June 2018
Despite higher oil prices, Angola’s economy will grow by just 1.5% this year, less than consensus expectations. Conditions will remain weak in 2019, though reforms could provide a boost further out. … Angola: Only a mild rebound in …
4th June 2018
Today’s manufacturing PMI – which fell to 49.8 – provides yet more evidence that South Africa’s economy struggled in early 2018. We retain the view that growth will pick up later this year. … South Africa Manufacturing PMI …
1st June 2018
Inflation in Kenya and Uganda will pick up over the coming months. The shift will be mostly due to base effects, and with inflation within target, policymakers in both countries will cut rates by 50bp in Q3. … E. African inflation: Still on track for rate …
31st May 2018
Most African currencies weakened against the US dollar this month, but avoided the sharp falls seen elsewhere in the EM world. Zambian markets, however, struggled due to fears of hidden debts. … Africa: A weak month for local …
29th May 2018
Hopes that President Cyril Ramaphosa will reform South Africa’s economy have grabbed the headlines. But reforms are also underway elsewhere; recent pro-business moves in Angola show the most potential. … Pro-business reform in Africa: Angola stands …
25th May 2018
South African policymakers, who left their key rate at 6.50% today, struck a hawkish tone. Though inflation will pick up this year, a hike is unlikely. We think the next move will be a small cut in 2019. … South Africa: Hawkish tone, but rates on hold for …
24th May 2018
South African inflation edged up to 4.5% y/y in April, following a VAT hike at the start of the month. Taking that together with the recent fall in the rand, we think that the MPC will leave interest rates unchanged at its next meeting tomorrow, having …
23rd May 2018
A surprisingly hawkish MPC statement suggest that Nigerian policymakers (who held their key rate at 14.00% today) will keep rates on hold for most of this year. But they will still probably cut rates by 100bp in Q4 when inflation is weaker and the effects …
22nd May 2018
Nigeria’s economic recovery lost momentum in Q1, but we still think that growth will strengthen later this year. Higher oil revenues should provide a big boost to incomes in Q2. … Nigeria GDP (Q1 …
21st May 2018
Most African economies remain heavily-dependent on the agricultural sector. Indeed, weather-related disruptions often play a key role in determining swings in headline economic growth. The sector is currently very inefficient, but it has the potential to …
18th May 2018
The 2018 budget finally passed by Nigerian legislators yesterday will have little effect on fiscal policy. Expenditure – particularly on capital projects – will fall far below the government’s ambitious target. … Nigeria: Long-delayed budget tells us …
17th May 2018
Today’s retail figures add to the evidence that South Africa’s economy faltered at the start of 2018, with GDP actually contracting in Q1. We still think that growth will return Q2 and remain strong this year. … S. Africa: Growth stalls in Q1, will pick …
16th May 2018
Inflation in Nigeria slowed sharply in April, and we think that it will continue to ease over the coming months. This will prompt policymakers to cut their key rate from 14.00% to 13.00% in June. … Nigeria Consumer Prices …
15th May 2018
Today’s activity data suggest that growth faltered in Q1. Recent surveys, however, point to improving conditions, and we maintain our above-consensus GDP growth forecast of 2.0% over 2018 as a whole. … South Africa: Economy stumbled in …
10th May 2018
The recent rally in oil prices – Brent crude has climbed to a fresh four-year high of $77pb in recent days – will provide a welcome boost to the region’s major oil exporters, Angola and Nigeria. If oil prices stay at their current levels, Angola’s export …
9th May 2018
We’ve long argued that Zambia’s debt position is very fragile. Adverse commodity price moves, for instance, could quickly push it into debt distress. If recent allegations that officials have understated the debt load are confirmed, this would cause …
4th May 2018
