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PMI: As inflationary pressures continue unabated across the continent, businesses are having to contend with higher input costs across the board. The latest PMI data shows that in May, business conditions have deteriorated across the continent with output falling and general demand waning. See omnystudio.com/listener for privacy information.
Namibia: The latest data from the Hospitality Association of Namibia shows an improvement in National Occupancy rates. Room occupancy in April was recorded at 36.5% relative to 27.0% over the same period last year. See omnystudio.com/listener for privacy information.
SSA: Zambia has announced a 3.3% increase in pump prices on the back of rising oil prices. Earlier this week, South Africa, which has extended its fuel price relief, See omnystudio.com/listener for privacy information.
Kenya: Inflation has passed the 7% mark in Kenya, coming in at 7.1%y/y as food and fuel inflation continues to drive average prices higher. This is the highest print since February 2020. Cooking oil and wheat prices continue to increase in Kenya and will likely keep food inflation elevated for longer- currently food and non-alcoholic beverages is growing by 12.4%y/y. See omnystudio.com/listener for privacy information.
Kenya: In line with our base case scenario, the MPC opted to increase interest rates by 50bp, raising the benchmark interest rate from 7.0% to 7.5%. The narrative for higher interest rates is similar to that of other economies and can be summarised as: rising global uncertainty on account of the Russia/Ukraine war; higher global interest rates and higher global inflation. See omnystudio.com/listener for privacy information....
Egypt: Moody’s has changed Egypt’s outlook to negative from stable, whilst maintaining the sovereign rating at B2. The effects of the pandemic are having a devastating impact on the Egyptian economy as food inflation soars and as concerns around supply chain prevail. See omnystudio.com/listener for privacy information.
he inflation deceleration trend continued in May as headline CPI printed 130bp lower at 10.2% from 11.5% in April. See omnystudio.com/listener for privacy information.
Mozambique: During the first quarter of the year, the economy grew 4.1% as sectors such as hotels and restaurants, extractive industry, transport and logistics sector grew above 5.0% over the same period. Meanwhile, low growth was found in the public administrative levels, real estate and fishery which continue to growth by less than 1.0%. See omnystudio.com/listener for privacy information.
The Bank of Ghana opted to raise the main policy rate by a further 200bp, from 17% to 19%. The move was largely anticipated given the rising inflationary pressures in the economy. See omnystudio.com/listener for privacy information.
Ghana: With inflation soaring past 20% and real policy rates turning negative, we expect the BoG to continue hiking interest rates in the near term. In our base case, we expect the Bank of Ghana to increase interest rates by 300bp over the next 12 months. See omnystudio.com/listener for privacy information.
Egypt: In our March inflation commentary, we mentioned that the upward trend in inflation was likely going to lead to a further hike by the authorities in Egypt. Inflation in April however edged to 13.1%, significantly higher than market expectations, as food inflation impacted the basket. See omnystudio.com/listener for privacy information.
Zambia: At the second sitting of the year, the monetary policy committe in Zambia opted to maintain the policy rate at 9%. The deceleration in inflation and the projection for it to trend lower towards the 6-8 % target range by the end of 2023 were highlighted as the main reasons behind the decision. See omnystudio.com/listener for privacy information.
Zambia: The central bank of Zambia will have to balance two key themes during its monetary policy meeting brief: inflation, which has been decelerating over the past few months and; the rising global interest rate environment. See omnystudio.com/listener for privacy information.
Botswana: Botswana’s inflation moderated to 9.6% y/y in April (down from 10.0% y/y in March). The main contributors to the headline were the transport index, which accounted for 5.5ppt, utilities which made up 1.4ppt, food and non-alcoholic beverages (+0.8ppt) and miscellaneous goods and services (+0.7ppt). See omnystudio.com/listener for privacy information.
Wheat: India has instituted a ban of its wheat exports, a move that has sent global wheat prices higher amid an already tepid soft commodity environment. Price of wheat has escalated this year because of the Russia/Ukraine war and has been one of the key reasons for higher global inflation. See omnystudio.com/listener for privacy information.
Inflation has accelerated to 19.4%y/y in Ghana at the end of March. The latest print is the highest ever seen over the past decade as food and fuel prices continue to surge. See omnystudio.com/listener for privacy information.
Namibia: We expect the central bank of Namibia to hike interest rates today by 25bps in line with regional movements. Namibia’s inflation has been relative subdued over the past few years hovering between 2% and 6% over the past 5 years. See omnystudio.com/listener for privacy information.
Egypt: The latest data shows annual inflation came in at 10.5% at the end of March as the effects of Russia-Ukraine war exacerbate conditions in the country. Price pressures continue in the country as inflation expectations rise amid higher food and oil prices. See omnystudio.com/listener for privacy information.
PMI: The impact of the Russia-Ukraine war has had an impact on the latest PMI numbers with several respondents across the continent noting the disruptions on supply and the rising prices of basic goods like fuel, See omnystudio.com/listener for privacy information.
Fuel and fertilizer: Inflation expectations are expected to lift as the second quarter of the year starts. While oil prices have hovered above the US$100 per barrel over the past few weeks, soft commodity prices have been on an increase. See omnystudio.com/listener for privacy information.
Kenya: First quarter survey of CEOs operating in Kenya indicated that there is general optimism about the business environment on account of relaxed covid-19 rules, government infrastructure spending, anticipated better weather conditions and the general economic recovery momentum. See omnystudio.com/listener for privacy information.
Zambia: Inflation for March continued on its disinflationary path as it eased to 13.1% from the 14.2% recorded in February. The moderation can be attributed to a slower pace of price growth for both the food and non-food segments See omnystudio.com/listener for privacy information.
Mozambique: The monetary policy committee of Mozambique has opted to hike interest rates by 200bps, a sign that the central bank is concerned about inflation. Notably, the central bank targets single digit inflation – this hike suggests that the central bank is convinced that inflation would edge over 10% in the short to medium term. See omnystudio.com/listener for privacy information.
Kenya: The monetary policy committee have opted to keep interest rates flat in Kenya given their broad view that the economy is on a path of recovery and inflation at the moment remains within its target range. See omnystudio.com/listener for privacy information.
Mozambique: The IMF team reached a staff-level agreement with the Mozambican authorities on a new arrangement under the Extended Credit Facility (ECF) for 2022-2025 to support sustainable, inclusive growth, and long-term macroeconomic stability. See omnystudio.com/listener for privacy information.
Commodity prices have continued to soar since the start of the war in Europe. While part of the gains were associated with the general sell-off, the recent gains in base metal prices is influenced by concerns around supply. See omnystudio.com/listener for privacy information.
The MoF indicated that Zambia was on path to reach an IMF board approval by mid-year. While we change our base case for board approval later in the second half of the year, we agree that overal momentum around Zambia’s fiscal and economic developments, is improving. See omnystudio.com/listener for privacy information.
Ghana: The Ghanaian authorities are expected to announce budget cuts later today to improve the fiscal trajectory of the country. Concerns have mounted over the past year regarding the authorities’ abilities to both contain expenditure and present credible revenue targets. See omnystudio.com/listener for privacy information.
Egypt: Since the onset of the Russia-Ukraine war, Egyptian authorities have set in motion both fiscal and monetary policy changes. We saw similar swift responses from the authorities at the onset of the pandemic in 2020. See omnystudio.com/listener for privacy information.
Ghana: Bank of Ghana has opted to hike the main policy rate by 250bps, raising it to 17% in an attempt to arrest inflation across the economy. The MPC has seemingly opted to frontload it hikes as opposed to taking a staggered approach towards its hiking cycle. See omnystudio.com/listener for privacy information.
