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The rise of capital inflows into Nigeria in Q3 suggests that the worst of the problems in the country’s balance of payments are over. But significant strains remain. … Nigeria: Capital inflow figures cause for muted …
7th November 2016
The Nigerian senate’s decision to block the president’s borrowing plans may preclude an infrastructure-focused stimulus plan. The bill’s failure highlights the importance of boosting domestic non-oil revenue. … Nigeria: Failed debt plan another blow to …
2nd November 2016
South Africa’s manufacturing PMI fell dramatically last month. The sharp fall in the measure of future conditions suggests that hopes of a swift improvement in the country’s economic and political situation are fading. … South Africa Manufacturing PMI …
1st November 2016
News that Mozambique is seeking to restructure its debts sent its US$ bond yields soaring. South African markets shrugged off another attempt to depose the respected finance minister. … Mozambique: Debt revelations push up bond …
28th October 2016
Political developments across Africa have raised risk perceptions in several key economies. Allies of South Africa’s president made yet another attempt to force the resignation of Pravin Gordhan, the country’s respected finance minister. A broad coalition …
27th October 2016
Finance Minister Pravin Gordhan’s budget plans rely on an economic acceleration that we believe is unlikely to materialise. If growth stays weak, South Africa will over-shoot its deficit and debt targets. … South Africa: Fiscal goals still too …
26th October 2016
It seems likely that Mozambique will eventually reach a debt restructuring deal with its creditors. But the revelation of yet more hidden debt (or another currency fall) could result in a messier outcome. … Mozambique: What to make of the latest debt …
Concerns about the health of Nigerian banks have risen over the past month. Indeed, as we explain in this Watch, it now looks increasingly likely that parts of the financial sector will require recapitalisation. That said, the risk of a widespread crisis …
20th October 2016
August output data suggests that South Africa’s economy did not sustain the rapid growth posted in Q2 into Q3. We expect that growth will be very weak over the remainder of 2016 and into 2017. … South Africa: Economy falters in …
19th October 2016
September's slightly weaker-than-expected inflation figure supports our view that the SARB will hold its key policy rate unchanged at 7.00% over the coming quarters rather than hiking rates. … South Africa Consumer Prices …
While above very muted expectations, manufacturing output data for August suggest that economic growth slowed in Q3. … South Africa Manufacturing Output …
11th October 2016
The government’s decision to establish a state of emergency could worsen Ethiopia’s rolling political crisis. The deteriorating situation risks knocking the country off its current growth trajectory. … Ethiopia: Political crisis rocks African growth …
10th October 2016
South Africa’s manufacturing PMI rebounded in September, but remained relatively weak. The indicator has been unreliable lately, but the tepid result supports our view that the economic acceleration seen in Q2 was not sustained in Q3. … South Africa …
3rd October 2016
The widening gap between Nigerian’s official and parallel exchange rates highlights the CBN’s continuing influence over the official FX market. We expect that the official rate will be devalued by another 15% by the end of 2016. … Nigeria: Naira crashes …
30th September 2016
After contracting sharply in Q1, South Africa’s economy has bounced back faster than many – including ourselves – had suspected. Growth will probably pick up a bit next year, but we suspect that South Africa’s economy will remain very weak over the medium …
29th September 2016
The latest GDP figures all support our view that economic growth in Sub-Saharan Africa as a whole will be even worse in 2016 than it was in 2015, when it hit a 16-year low. The key question now is whether the slump is near its low point. The data released …
28th September 2016
Today’s statement from the South African Monetary Policy Committee suggests that rates in the country are no longer likely to be hiked later this year. … South Africa: MPC Statement hints tightening cycle …
22nd September 2016
August’s within-target inflation reading of 5.9% y/y makes it all but certain that the Reserve Bank will hold its key interest rate at 7.00% at its meeting tomorrow. … South Africa Consumer Prices …
21st September 2016
The MPC’s decision to hold rates at 14.00%, thus rebuffing government calls for looser interest rates is an encouraging sign of the bank’s independence. We expect that rates will have to rise later this year. Elsewhere, Kenyan rates were cut from 10.50% …
20th September 2016
Activity data for July and August suggest that the economic situation in Nigeria deteriorated going into the third quarter. The economy will probably continue to contract over the duration of 2016. … Nigeria: Early signs point to deepening contraction in …
15th September 2016
Output figures for July suggest that South Africa’s economy weakened a bit at the beginning of Q3. This supports our view that strong growth in Q2 was a brief rebound, not the beginning of a lasting pickup. … South African economy losing steam in …
14th September 2016
South Africa’s current account position improved by more than we’d expected in Q2, but the shortfall will still probably remain relatively wide over the coming year. … S. Africa Current Account …
13th September 2016
The successful launch of Ghana’s fifth Eurobond is a sign of the markets’ growing confidence in the country. While the economy remains fragile, we expect that the worst is now behind us. … Ghana: Eurobond provides boost to confidence in fragile …
12th September 2016
The first Q3 South African output data support our view that the rapid growth reported in Q2 is unlikely to be sustained. The economy may post positive growth in 2016 as a whole, but only marginally. … South Africa: Output falters at start of …
8th September 2016
Strong q/q growth in Q2 mostly reflects a bounce back following the disaster of Q1. We expect that growth will be sluggish in the second half of the year. … South Africa GDP …
6th September 2016
The sharp decline in South Africa’s manufacturing PMI looks worrying. But we wouldn’t panic; the survey has become a less reliable leading indicator recently. … South Africa Manufacturing PMI …
1st September 2016
The contraction of Nigerian GDP in Q2 was driven by a sharp fall in oil output, but the data shows that other sectors of the economy are also suffering. Economy policy has made a bad situation worse. … Nigeria: Economy plunges into broad-based …
31st August 2016
Official data released over the past month mostly suggested that African economies improved a touch, but a series of political shocks has hit investor confidence. The most high-profile of these as been the latest dispute between South African President …
30th August 2016
Political risk has roiled the markets in South Africa, Nigeria, and Kenya over the past month. Tensions within South Africa’s cabinet, which pose a risk to the country’s already fragile economy, should be of greatest concern to investors. … Africa: …
26th August 2016
South African inflation eased from 6.3% y/y in June to a weaker-than-expected 6.0% in July, but we still think that inflation will pick up again later this year, prompting the Reserve Bank to hike rates by 25bp. … South Africa Consumer Prices …
24th August 2016
This week’s high-profile Japan-Africa summit will not change the fact that Tokyo remains a relatively minor player in Africa. In some areas, however, Japan will continue to play a significant role. … Africa: Japan’s role will remain …
23rd August 2016
After two years of progressively slower growth, most African economies will strengthen in 2017. This recovery will be driven by rising commodity prices, which should ease strains in the balance of payments, and weaker inflation (in most countries). The …
22nd August 2016
The statement accompanying the Hungarian MPC’s meeting earlier today, at which the policy rate was left on hold at 0.90%, gave no sign that monetary easing is on the Council’s agenda. But we think growth and inflation are likely to be lower than the MPC …
17th August 2016
Zambia’s disputed election has raised the risk of a period of political uncertainty, but with the vote out of the way, we think that it’s now likely that the government will agree to a long-delayed IMF bailout. An IMF-imposed fiscal squeeze means that …
June’s manufacturing and mining figures support our view that the South African economy expanded by about 1.5% q/q (saar) in Q2, thus avoiding a technical recession. We still expect that the economy will stagnate over the course of 2016 as a whole. … …
11th August 2016
The sharp fall in Ghanaian inflation supports our view that the worst is over for Ghana’s economy. Thegradual reduction of economic imbalances will help inflation moderate over the coming months. … Ghana: Inflation headed down as economic imbalances …
10th August 2016
Economic growth in Angola is grinding to a halt as the economy adjusts to lower oil prices. Growth will recover in 2017 and 2018, but more gradually than most expect. … Angola: Gradual recovery after a painful …
9th August 2016
The revelation that Mozambique’s government has failed to disclose the true level of its foreign debts has hit sentiment towards the country, which had been seen as an African outperformer. But while the situation is serious, the risk of a full-blown …
5th August 2016
Yesterday’s local elections suggest that South African elections may be becoming more competitive. Foreign investors will probably welcome the fact that reduced support for the ruling ANC has helped the centrist DA rather than the leftist EFF. … South …
4th August 2016
After years of regional outperformance, we expect that Uganda’s economy will slow more sharply than most expect in 2017. Even so, the external vulnerabilities that have built up during the past few years limit the room for looser monetary conditions. … …
3rd August 2016
South Africa’s manufacturing PMI slipped a bit in July, but it still points to manufacturing output growth of about 5.0%. … South Africa Manufacturing PMI …
1st August 2016
Nigeria’s self-proclaimed move to a more “flexible” exchange rate last month was initially a disappointment, with the Central Bank of Nigeria reasserting its grip at N282/US$. Over the last week, however, the bank has belatedly allowed the currency to …
29th July 2016
The Central Bank of Nigeria has loosened its grip on the naira in recent days, causing us to review our forecast. Elsewhere, South Africa’s equities and currency have outperformed. … Africa: Naira finally breaking …
28th July 2016
The Central Bank of Nigeria’s latest rate hike is a belated attempt to regain control over the country’s weakening currency. We expect that the bank will tighten by at least another 200bps later this year. … Nigeria: CBN hikes rates despite threat to …
26th July 2016
The Central Bank of Kenya decided to hold its key rate at 10.50% today, but we expect that the bank will cut rates later this year as inflation remains within target and Kenya’s external vulnerabilities ease. … Kenya: Rates on hold, cuts still in the …
25th July 2016
The weakness of South Africa’s economy prompted the MPC to hold off hiking interest rates today, but we still think there is room for additional monetary tightening later in the year. For now, we think it’s most likely that the MPC will raise its policy …
21st July 2016
Nigeria’s new exchange rate policy falls far short of the authorities’ bold promises and we think the currency will have to fall further over the coming 12 months or so. … Nigeria: currency reforms fall short of high …
Last month’s rise in South African inflation, to 6.3% y/y, took the headline rate further above the Reserve Bank’s target range, and both we and the Bank expect it to edge higher over the rest of this year. Nonetheless, the weakness of the economy, …
20th July 2016
A string of positive trade figures released over the past few months has raised hopes that South Africa’s balance of payments position might finally improve. In this Watch, however, we explain why the country’s large investment income deficit means that …
19th July 2016
Despite the sharp rise in Nigerian inflation last month, we think it will still be some time before the headline rate peaks. This will force the central bank to tighten monetary policy even in the face of a very weak economy. … Nigeria: Rise in inflation …
18th July 2016
