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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
The surprise contraction of consumer spending in Q1 was largely due to distortions caused by the growing popularity of “Black Friday” sales. We expect that spending picked up in Q2 as these faded. … South Africa: Consumer spending set to pick up in …
5th July 2017
The sharp fall in South Africa’s manufacturing PMI suggests that the sector struggled towards the end of Q2. But we would caution against reading too much into an indicator that has become increasingly volatile in recent quarters. … South Africa …
3rd July 2017
The slowdown in Kenyan GDP growth in Q1 supports our view that growth in 2017 as a whole will be weaker than most expect. … Kenya: Economic slowdown …
30th June 2017
Most African currencies weakened in June, though Nigeria’s was a key exception. The naira will probably stay pretty stable on both the official and parallel rates. … Africa: Currencies struggle, but equities remain …
29th June 2017
Revisions to the charter governing South Africa’s mining sector have been opposed by the industry and rattled the markets. In this Watch , we examine the industry’s complaints, explain the political context behind this increasingly interventionist turn in …
28th June 2017
After a very poor start to the year, most of Africa’s larger economies bounced back at the start of Q2. South African activity data suggest that the region’s most industrialised economy returned to growth in April after entering a recession in Q1. Survey …
23rd June 2017
Inflation in South Africa ticked up in May, but we still expected that inflation will ease later this year, prompting the Reserve Bank to cut its key policy rate by a total of 50bps. … South Africa CPI …
21st June 2017
South Africa’s current account deficit widened a touch in Q1, but remained small by recent standards. This will help to shield the rand from the effect of political shocks. … South Africa Current Account …
20th June 2017
We think that the easing of inflation in Nigeria, which slipped to 16.3% y/y in May, will pave the way for looser monetary policy this year. … Nigeria Consumer Prices …
15th June 2017
The first activity data from the start of Q2 suggest that South Africa’s economy recovered after the grim performance in Q1. This supports our view that growth has held up better than most expected. … South Africa: Economy bouncing back in …
14th June 2017
April’s activity data suggest that South Africa’s economy remained weak at the start of Q2. Next week’s retail sales figures will give us a clearer indication of whether crucial consumer-facing sectors picked up. … South Africa: Economy struggled at start …
8th June 2017
New data show that South Africa’s economy was already contracting before the latest political drama. While we think that things will get better later in the year, risks to our above-consensus growth view for 2017 are now clearly to the downside. … South …
6th June 2017
Kenyan inflation will remain above-target for the duration of 2017, prompting the CBK to hike its key policy rate from 10.00% to 10.50%. Elevated inflation and tighter policy will weigh on growth. … Kenya: Inflation will add to economic headwinds in …
2nd June 2017
Having fallen sharply in April, South Africa’s manufacturing PMI surged May. We don’t put much faith in this indicator, but today’s reading supports our view that the economy is holding up better than most expect in the face of difficult political news. … …
1st June 2017
South Africa’s ongoing political drama caused the rand to wobble this month, but the currency soon stabilised. Equities across the region performed well, with Nigerian stocks leading the charge. … Africa: Rand driven by politics, most markets …
31st May 2017
Events over the past month have raised questions about the positions of the presidents of Sub-Saharan Africa’s three largest economies. Nigeria’s President Muhammadu Buhari missed a key speech commemorating the two year anniversary of his own …
30th May 2017
Today’s MPC statement from the governor of the South African Reserve Bank supports our nonconsensus view that policymakers will cut their key policy rate to 6.50% by the end of the year. … South Africa: MPC strikes a dovish …
25th May 2017
The continued fall of South African inflation – which dropped to 5.3% y/y in April – supports our view that the Reserve Bank will cut its key policy rate later this year. … South Africa CPI …
24th May 2017
Nigeria’s central bank held its key rate on hold again, but we expect that policymakers will cut rates later this year as inflation slows and the economy remains weak. … Nigeria: CBN holds rates, but hints that cuts are …
23rd May 2017
Nigeria’s economy continued to contract in Q1, albeit at a slowing rate. Fading problems in the oil sector and the improvement of the non-oil sector suggest that growth will return in Q2. … Nigeria: Recession continues, but non-oil GDP picks …
Despite some fiscal loosening, we expect that Nigeria’s federal budget deficit will be just 2.5% of GDP in 2017. But this measure provides a misleading sense of the country’s fiscal health. … Nigeria: Narrow budget deficit obscures fiscal …
19th May 2017
Surprisingly strong retail sales figures support our view that the South African economy held up better in Q1 than many feared. The effect of recent political turbulence, however, will not be felt until Q2. … South Africa: Economy probably dodged …
17th May 2017
The lead-up to Kenya’s general election in August is coinciding with rising scepticism in the country about the quality of official economic figures. In this Watch , we will lay out why we are increasingly wary of Kenya’s official growth numbers – which …
16th May 2017
Mining and manufacturing figures show that both sectors unexpectedly strengthened at the end of Q1. This may cushion the impact of any hit to consumer confidence caused by recent political turbulence. … South Africa: Industrial sectors held up in …
11th May 2017
The success of Ethiopia’s fledgling manufacturing sector distinguishes the country from its African peers. But comparisons with Asia’s manufacturing-led boom are, at least as yet, premature. … Ethiopia: Talk of a manufacturing-led boom is …
8th May 2017
This week’s survey indicators provided mixed signals regarding the economic effect of political turbulence in South Africa. But they do, at least, suggest that the immediate economic hit may have been less than some had feared. … South Africa: Business …
4th May 2017
After a year of contraction, the economies of Nigeria and Angola are finally recovering. Growth will stay weak by recent standards, but will probably outpace overly-bearish consensus expectations. … Nigeria & Angola: Light at the end of the …
3rd May 2017
South Africa’s April PMI, which came in at just 44.7, provided an early sign that the sacking of Pravin Gordhan dealt a serious blow to confidence. Other business confidence figures released later this week will provide a clearer sense of the damage. … …
2nd May 2017
April was another dramatic month for African currency markets. The rand fell against the US dollar after the sacking of Finance Minister Pravin Gordhan prompted a ratings downgrade, before clawing back about half of its losses. And Nigeria’s FX system was …
28th April 2017
The relative resilience of South African financial markets in the face of the latest political turbulence has prompted us to revise our end of year rand forecast from R15/US$ to $14/US$. Markets elsewhere in Africa performed pretty well. … South Africa: …
27th April 2017
Ghana’s new government inherited an economy that was already turning the corner. After years of underperformance, growth in Ghana will accelerate sharply in 2017. … Ghana: A key African growth star in …
25th April 2017
