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The results of yesterday’s re-run presidential election in Kenya are not in doubt. But signs suggest the country’s political crisis – which has already weighed on the economy and local markets – will drag on. … Kenya: Boycotted election threatens lasting …
27th October 2017
Today’s Medium Term Budget Policy speech confirmed that South Africa’s fiscal position has deteriorated since February. But the deficit – which is not as worrying as some seem to think – is the result, rather than the cause of South Africa’s economic …
25th October 2017
Attention this month has focused on political stories in Kenya, South Africa, and Angola. We will continue to cover these issues in other publications. While economic data released over the past month grabbed fewer headlines, we think that it provided a …
24th October 2017
Market expectations towards South African interest rates have shifted markedly in recent weeks. While a rate cut next month is no-longer likely, we think that the markets have moved too far, and are now under-estimating the chance of looser policy over …
20th October 2017
New activity data suggest that South Africa’s long-suffering economy experienced comparatively robust growth in mid-Q3. Today’s figures support our markedly above-consensus growth forecasts. … South Africa: Growth remained robust in …
18th October 2017
Nigeria’s budget deficit is, perhaps surprisingly, smaller than the government had expected. But this comes at a significant economic cost. And even the country’s small shortfall may prove hard to fund. … Nigeria: Deficit within target, but finances …
17th October 2017
Kenya’s post-election legal drama is still rapidly developing. But the latest developments all suggest that the country’s chance of avoiding a violent (and economically painful) crisis is dwindling. … Kenya: Risk of violent crisis …
13th October 2017
After bouncing back in Q2, the latest activity data suggest that South Africa’s economy remained strong in mid-Q3. This supports our above-consensus growth forecasts for the country. … South Africa: Economy remained strong in …
12th October 2017
Sceptics are right to question the reliability of official economic statistics in Africa, but the problems unevenly distributed across the region. For Africa’s larger economies, we think that the official data provide a reasonably accurate (if frequently …
We expect that economic growth in Sub-Saharan Africa will continue to accelerate in 2018. This recovery will be driven largely by faster growth in the region’s three biggest economies – Nigeria, South Africa, and Angola – all of which have suffered …
10th October 2017
A combination of rising political risk and falling commodity prices caused key African markets to weaken over the past month. Only a few markets bucked the trend, and they gained very little ground. … African markets soften in …
28th September 2017
GDP figures released this month showed that the economic fortunes of Africa’s largest economies diverged in Q2. South Africa’s economy rebounded after a brief recession at the turn of the year. While investment spending remained weak, strength elsewhere …
27th September 2017
Nigerian policymakers kept rates on hold today, but the accompanying statement made it clear that easing is on the way. We expect that the first cut will come in Q1 2018. … Nigeria: Rates on hold, but cuts are still on the …
26th September 2017
The South African Reserve Bank has paused its loosening cycle, but we expect that it will cut rates at its November meeting, by which time inflation will have eased further. … South African loosening cycle put on …
21st September 2017
Inflation in South Africa was weaker than expected in August, which supports our view that the South African Reserve Bank will cut its key policy rate from 6.75% to 6.50% at its meeting tomorrow. … South Africa CPI …
20th September 2017
The Kenyan MPC kept rates unchanged today, but we expect that they will loosen policy next year as inflation falls towards the middle of the target range. … Kenyan MPC holds rates again, but will ease in …
18th September 2017
Nigerian inflation remained high in August, but we expect that it will ease over the coming months, prompting policymakers to cut interest rates. … Nigeria Consumer Prices …
15th September 2017
South Africa’s current account deficit was wider than expected in Q2, at 2.4% of GDP, but the big picture is that it has narrowed significantly over the past 18 months. The slightly wider shortfall is unlikely to prevent the Reserve Bank from cutting …
14th September 2017
July activity data suggest that South Africa’s economy weakened at the start of Q3. But GDP still grew by about 1.5% q/q saar at the start of Q3, supporting our above-consensus growth forecasts. … South Africa: Growth slips at start of …
13th September 2017
Most commentators hailed the Kenyan Supreme Court’s decision to annul the result of last month’s presidential election as a key win for the country’s democracy. This is, as yet, premature. The real test of the country’s institutions is still to come. … …
12th September 2017
South African mining data for July were weaker than expected but, taken together with the manufacturing figures also released today, it looks like the economy may have strengthened a little at the start of Q3. Moreover, the data confirm our suspicions …
7th September 2017
Africa’s two largest economies returned to growth in Q2. But while South African growth rebounded, things in Nigeria remained very weak, causing us to downgrade our 2017 growth forecast to 1.2%. … Q2 GDP: South Africa rebounds, Nigeria limps out of …
5th September 2017
GDP figures due out Tuesday will probably show that the Nigerian & South African economies returned to growth in Q2. Indeed, we think that both countries will perform better than most expect this year. … Nigeria & South Africa: Key economies bounced back …
4th September 2017
South Africa’s manufacturing PMI remained extremely weak last month. And while the survey has tended to overstate downturns in recent years, it may suggest that the economy softened in Q3. … South Africa Manufacturing PMI …
1st September 2017
August was another strong month for African markets as key equity indices gained. Fears that politics would knock markets off course proved ill-founded. … African markets continue to pick …
30th August 2017
Angola’s new president inherits an economy that will perform worse than most expect in 2017. High levels of FX debt and shaky government finances raise the significant risk of a painful debt crisis. … Angola: New president, same …
25th August 2017
Attention this month focused on unfolding political dramas in Africa’s key economies. The president of South Africa narrowly saw off another no-confidence vote, Kenya’s president was re-elected in a vote that the opposition claim was rigged, and Nigeria’s …
24th August 2017
South African inflation eased by more than we’d expected in July, raising the prospect of two 25bp cuts later this year, rather than the single cut we currently expect. … South Africa CPI …
23rd August 2017
A new survey of corruption in Nigeria’s public service underlines the economic costs of its onerous FX and customs regime. The publication of the commendable frank survey is, in itself, a very positive sign. … Nigeria: New survey quantifies cost of …
18th August 2017
South African retail sales figures released earlier today support our view that the country’s economy returned to growth in Q2. We expect that growth will surprise to the upside over 2017 as a whole. … South Africa: Retail sales point to stronger …
16th August 2017
The Nigerian authorities’ decision to allow commercial banks to quote a floating exchange rate, rather than the less-frequently used official rate has been interpreted by some as a move towards a unified exchange rate. However, while several of the …
11th August 2017
South Africa’s mining and manufacturing sectors both contributed positively to headline growth last quarter. If we’re right that retail sales picked up, then GDP rebounded faster than most expect in Q2. … South Africa: Output data point to Q2 …
10th August 2017
Claims of tampering in yesterday’s Kenyan election have increased fears of a violent dispute. A crisis may still be avoided, but the risk of a deadly (and economically damaging) dispute is increasing. … Kenya: Disputed result raises risk to …
9th August 2017
The risk of violence following next week’s election is rising. A repeat of the 2007-08 crisis would cut about 3.0%-pts off GDP growth in Q3; the total cost would depend on the length of the disturbance. … Kenya: Election poses key risk to already slowing …
4th August 2017
South Africa’s manufacturing PMI fell to an eight year low in July. The indicator, however, frequently overstates weakness, and we doubt things were that bad. … South Africa Manufacturing PMI …
1st August 2017
Most African currencies and equity markets gained a bit of ground in July. Mozambique – where debt worries deepened – was a rare exception. … A strong month for local …
31st July 2017
Nigeria’s agreement with OPEC to cap oil production is unlikely to have much impact on the economy; output was never likely to rise significantly above this level in any case. The key point is that oil production and revenues will remain much higher than …
28th July 2017
The latest data support our view that the recoveries in Sub-Saharan Africa’s big three economies will be stronger than most expect. Activity data in Nigeria, South Africa, and Angola all suggest that growth accelerated in Q2. The turnaround in South …
27th July 2017
Nigeria’s central bank kept its key interest rate on hold at 14.00% today, but the governor’s speech made it clear that policy loosening is on the agenda. We expect 200bp of cuts by the end of this year. … Nigeria’s central bank pauses before launching …
25th July 2017
The SARB’s easing cycle will be gradual and data-dependent, but the key policy rate will fall to 6.00% by the end of 2018. Looser policy supports our non-consensus view that growth will pick up this year. … South Africa: Beginning of a gradual loosening …
20th July 2017
The latest South African activity data suggests that, as we had expected, growth rebounded in Q2. Slowing inflation supports our view that the SARB will cut its key policy rate on Thursday. … South Africa: Economy bounced back in …
19th July 2017
Policymakers across Africa are set to loosen monetary policy sooner and more dramatically than most think. We expect cuts in South Africa, Nigeria, Angola, Kenya, & elsewhere over the coming months. … Africa: Monetary policy easing cycle is getting into …
The CBK’s decision to keep its key rate on hold signals its willingness to look through the current period of above-target inflation. With inflation having now peaked, we expect that the next move will be a cut. … Kenya: Rates on hold, next move will be a …
17th July 2017
The slowing of Nigerian inflation in June will soon prompt policymakers to loosen monetary policy. Cuts will come faster than the consensus currently expects. … Nigeria Consumer Prices …
A new IMF paper highlights the large role the informal sector plays in African economies. It casts further doubt on official growth figures, and suggests that debt-to-GDP figures are painting a flattering picture. … Africa: Informal economies pose …
14th July 2017
Increased political criticism of the South African Reserve Bank has focused attention on threats to the country’s key economic institutions. But, as we’ve written before, we think that most of these fears are overblown. Political risk elsewhere in the …
13th July 2017
Despite a string of political shocks, South African consumer confidence was higher in Q2 2017 than it was over most of 2016. This supports our view that the worst is over for the country’s troubled economy. … South Africa Consumer Confidence (Q1 & …
12th July 2017
South African manufacturing data for May show that the sector’s contraction eased in the middle of Q2. Combined with a pickup in consumer spending, this supports our view that GDP growth returned to positive territory after contracting in Q1. … South …
11th July 2017
We expect that growth in Sub-Saharan Africa will accelerate over the coming years as the three largest economies in the region – South Africa, Nigeria and Angola – recover from recent recessions. Indeed, our GDP forecasts for these countries in 2017 and …
7th July 2017
The ANC’s policy conference highlighted divisions within the party, and suggested a significant pushback against its recent leftist turn. While the president’s more populist faction is weakened, a victory for his chosen successor remains the most likely …
6th July 2017
