Nigeria and Ghana’s contrasting hikes, Niger’s coup

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.