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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
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
