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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
Perceptions of the economic ties between China and Africa are often based on inaccurate assumptions. In this Focus we debunk three key myths. The China-Africa relationship is not as state-driven, as economically dominant, nor as resource-focused as many …
3rd May 2018
Today’s strong PMI reading – which recovered to 50.9 – may not tell us much; the measure has been highly volatile lately. Other indicators, however, also point to growing confidence in the economy. … South Africa Manufacturing PMI …
2nd May 2018
Today’s inflation figures support our view that policymakers will cut their key rate in July. Meanwhile, the rebate surrounding Kenya’s lending rate cap suggests that the controversial law will be scrapped. … Kenya: Weaker inflation points to rate …
30th April 2018
Commodities make up a large part of Africa’s exports but the degree of dependence and product diversification varies across the region. While the value of net exports of energy producers, including Angola and Nigeria, will be higher this year than last, …
27th April 2018
The rand’s recent rally seems well and truly over; it weakened against the US dollar by even more than EM peers this month. We expect that the currency will continue to fall late this year. … Africa: Mixed month for markets, but rand …
Labour relations in South Africa are deteriorating. Public sector wage talks are particularly fraught; a strike could cripple government services, while a big wage hike would sharply widen the budget deficit. … South Africa: Public sector wage talks pose …
25th April 2018
Ethiopia’s ruling party appointed a new prime minister on 2nd April, stabilising a situation that had been in flux since the previous incumbent’s resignation in February. Abiy Ahmed inherits a divided coalition and faces the challenge of de-escalating …
20th April 2018
Today’s retail figures show that consumer spending was robust in Q1. The comparison with a very strong result in Q4 will depress q/q GDP growth this quarter, but we don’t think that this marks a turning point. … South Africa: Growth slowed in …
18th April 2018
South African policymakers are being forced to delay the introduction of a long-planned national minimum wage bill. Overall, we think that the bill is probably a positive step for the country. The government’s failure to implement it on time, however, is …
17th April 2018
After a recent drought-related slowdown, Uganda’s economy will pick up over the next few years as policy becomes more supportive and oil production plans are stepped up. We think that growth will exceed consensus expectations in 2018 and 2019. … Uganda: …
16th April 2018
We expect that economic growth in Sub-Saharan Africa will continue to accelerate in 2018. This recovery will be driven largely by South Africa and Nigeria, where growth is set to pick up by more than most expect. Performances elsewhere in the region will …
13th April 2018
Inflation in Nigeria slowed sharply last month, 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 12.00% by year end. … Nigeria Consumer Prices …
12th April 2018
Growth in South Africa’s manufacturing sector cooled in February, providing another sign that the economy faltered a bit in Q1. Even so, we retain the view that growth will pick up later this year. … South Africa Manufacturing …
10th April 2018
Many analysts now talk of a recovery ‘in Africa’; but faster regional growth this year will be almost entirely due to accelerations in Nigeria & South Africa. Given weak economic links within Africa, this headline figure tells us little about activity …
5th April 2018
Today’s Nigerian MPC press conference supported our view that policymakers will cut rates later this year. We think that the key rate will fall from 14.00% – at which it was left today – to 13.00% in June. … Nigeria: Rates on hold, but cuts likely later …
4th April 2018
South Africa’s March manufacturing PMI was surprisingly weak. We retain the view, however, that growth remained strong in Q1. They survey has, after all, given misleadingly negative readings recently. … South Africa & Nigeria Manufacturing PMI …
3rd April 2018
March was a mixed months for African markets. While most currencies performed well, dollar bonds sold off. Most local markets did, however, gain over Q1 as a whole. … S. African ratings reprieve provides boost for …
29th March 2018
Today’s 25bp interest rate cut does not signal the start of a new easing cycle. We think that policymakers were attempting to seize the opportunity for a quick cut before inflation picks up later this year. … South Africa: Rate cut will be a …
28th March 2018
Today’s unexpectedly aggressive interest rate cut – which took the key rate to 18.00% – suggest that the current loosening cycle has further to run. We expect that the rate will fall to 16.00% by year end. … Ghana: Easing cycle …
26th March 2018
Recently-released GDP figures show that growth strengthened in both Nigeria and South Africa in Q4. The pickup in growth in Nigeria was mostly due to stronger activity in the non-oil sector, which compensated for a softer performance from the oil …
23rd March 2018
South Africa’s seems to have economy slowed in January, but the weakness of recent figures was exaggerated by the comparison with a strong performance at the end of 2017. We think that growth will accelerate over the course of 2018 as a whole. … South …
22nd March 2018
Political leaders from across Africa have gathered in Rwanda to sign an ambitious new trade pact. The African Continental Free Trade Agreement (AfCFTA) has been billed as the first step to creating a single African market that will bring down costs and …
21st March 2018
Africa’s public debt problems are currently concentrated in Mozambique, Angola, Ghana, Nigeria, & Zambia. Elsewhere, however, it would only take a small shock to prompt a crisis (Kenya & South Africa both look fragile). Attention has focused on the threat …
Weaker South African inflation (which slowed to 4.0% y/y in February) will add to calls for an interest rate cut this month. But we think that pending VAT hikes and a widening current account deficit will cause policymakers will probably hold off for now. …
20th March 2018
Today’s rate cut will be followed by another cut later this year. The pace of further easing will depend on when the government amends or abandons its controversial cap on lending rates. … Kenya: Easing cycle restarts, CBK mute on lending …
19th March 2018
