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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
South Africa’s new finance minister used this week’s budget statement to signal a shift away from further austerity, suggesting that Pretoria is prioritising support for the weak economy. Nigerian officials, by contrast, promised to tighten policy. Given …
26th October 2018
The government’s decision to accept a wider deficit rather than tighten policy to meet previous targets will push up debt levels. But so long as bond yields don’t rise sharply (which we doubt is likely) this should provide support to the flagging economy. …
24th October 2018
South African inflation stabilised in September remaining unchanged at 4.9% y/y. We think that inflation has peaked and expect that the SARB will keep its key rate on hold at next month’s policy meeting. … South Africa CPI …
South Africa’s new finance minister will probably announce further fiscal tightening in tomorrow’s Medium Term Budget Policy Statement in order to meet existing targets. This will likely placate ratings agencies, but supports our view that economic growth …
23rd October 2018
Worries about Africa’s rising public debt have focused on Mozambique and Zambia, but the situation elsewhere is less stable than it first appears. Nigeria’s debt position, for example, is very fragile. Full-blown crises may not be imminent, but we think …
22nd October 2018
Despite the weakness of the economy, South Africa’s new finance minister will probably use next week’s budget review to tighten fiscal policy, rather than to announce new stimulus measures. On a slightly more positive note, figures out this week did, at …
19th October 2018
August’s headline mining output figures were very poor. But it still looks like the economy as a whole finally escaped recession in Q3 due to recoveries in the retail and manufacturing sectors. … South Africa: Economy finally returning to …
18th October 2018
Economic growth in Sub-Saharan Africa will probably strengthen a touch in 2019, but growth across the region will remain weaker than consensus expectations. We think that growth in Nigeria will slow as oil prices fall and output stabilises. Meanwhile, the …
16th October 2018
Nigerian inflation remained essentially unchanged in September, which supports our view that – despite recent hawkish language – policymakers will leave their key rate on hold over the coming months. … Nigeria Consumer Prices …
The resignation of South Africa’s finance minister boosted the rand this week by demonstrating President Ramaphosa’s firm stance on corruption. Meanwhile, Nigeria’s key opposition party selected its presidential candidate – setting the stage for next …
12th October 2018
The Ghanaian and Ivorian authorities’ failure to agree on a harmonised farm-gate cocoa price dampened hopes of a ‘Choc-OPEC’ that could effectively influence the global market. But collaboration in other areas – like agricultural research – will boost the …
11th October 2018
Manufacturing figures released today supported our view that the economy exited recession in Q3. But growth probably remained weak by historical standards, which we think will forestall rate hikes. … South Africa Manufacturing Production …
Nigeria’s February 2019 election will offer a stark policy choice between stability under President Muhammadu Buhari and liberalising reforms under opposition leader Atiku Abubakar. While the vote will be close, President Buhari is probably the favourite …
10th October 2018
