Zambia: The statistics agency in Zambia reported first growth for 2022 at 2.4 q/q. Key contributors included Public Admin, ICT, Electricity, Accommodation and Real estate. 

Commodities: Over the past month, there has a been a significant decline in prices across most commodifies – fueled by fears of lackluster economic performance. The market is pricing in a recession as higher inflationary pressures erode production and chip away at discretionary spending. 

Côte d'Ivoire: Moody’s has affirmed Côte d'Ivoire’s sovereign rating at Ba3 and has changed its outlook from stable to positive. This is largely informed by the country’s prospects for growth between now and 2025 with GDP expected to print north of 7% according to the rating agency. In addition to strong growth and stable monetary policy, the rating agency expects fiscal conditions to continue to improve over the next few years.

Namibia: Fitch ratings agency has opted to downgrade Namibia’s sovereign rating from “BB” to “BB- “on account of worsening twin deficits relative to its peers. Fitch expects the budget deficit (% of GDP) to come in at 7.6% in 2022, wider than the average budget deficit of “BB” rated economies of 5.0%.

Egypt: The MPC opted to keep rates on hold as they wait to observe the impact of the year-to-date 300bp increase in interest rates. Lending rate remains at 12.5% while the deposit rate is 11.5%.

Namibia: Room occupancy rates from the Namibia Hospitality Association of Namibia continue their upward trend, coming in at 39.4% during May. This is higher than the 36.5% recorded in April and the 25.7% recorded over the same period last year. 

Namibia: The latest FNB Namibia residential property report indicated that the House Price Index grew by 4.7% at the end of the first quarter of this year, down from 7.1% at the end of 2021, but unchanged compared to 1Q21. 

Botswana: The Bank of Botswana’s (BoB) Monetary Policy Committee (MPC) increased the Monetary Policy Rate (MoPR) by 50bps at a meeting held on 16 June 2022, effectively increasing the MoPR from 1.65% to 2.15%. Furthermore, repo and reverse repo operations will be conducted at the MoPR (2.15%). 

Namibia: The latest FNB Rental Index data shows that prices edged up by 0.6% at the end of March as rental activity picks up across the country. According to the FNB Residential Rental report, upward price action is seen across the properties with more than three bedrooms. 

Mozambique: Food and transport inflation seem to be the main protagonists in the latest inflation print which came in at 9.3% y/y in May, highest level since September 2017. The Russia-Ukraine war and its impact on global prices combined with general disruptions in supply has led to higher import demand into the country. 

China: Commodity prices have reacted negatively to the news of China reimposing some of the lockdown conditions that it had started to loosen a few weeks ago. 

Egypt: Egypt inflation remains above 10%, coming in at 13.5% in May. The index has soared on the back of higher food prices. Egypt has been impacted by Russia-Ukraine war which resulted in disruptions to trade globally but more importantly has curtailed wheat trade. 

Ghana: Inflation in Ghana edged 27.6% y/y in May as transport prices rose by 39.0%y/y, household equipment by 33.8% y/y, housing and utilities by 32.3% y/y and food by 30.1% y/y.

Global: The World bank has revised its forecasts for 2022 global growth to 2.9% from its earlier expectations of 4.1% for the year. Necessitating the change is the Russia-Ukraine war and the subsequent economic impact across the world at a time when most economies were still recovering from the effects of the pandemic. 

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. 

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. 

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, 

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.

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.

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.

he inflation deceleration trend continued in May as headline CPI printed 130bp lower at 10.2% from 11.5% in April.

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%. 

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.

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. 

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. 

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. 

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.

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). 

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.

Inflationary pressures in Namibia continue to be elevated as the April inflation print accelerated rapidly to 5.6% y/y from 4.5% in March 2022. This is the highest print observed since November 2018.

Inflation: A weak currency, rising food and fuel costs are key factors currently driving the surge in average prices in Ghana. The latest headline inflation prints for April came in at 23.6% y/y, the highest reading recorded over the past 10 years. Food inflation, which accounts for 43.12% of the overall CPI weightings, increased by 26.6% y/y over the same period as the price of cereal and cereal products increased dramatically (see comments on global food and oil transport here 

Inflation: The first inflation print in the second quarter of the year continues to show a rise on average prices. Since the beginning of the quarter, oil prices have somewhat settled - trading between US$100 and US$110 per barrel.

Mozambique: The IMF board has approved an Extended Credit Facility (ECF) to Mozambique worth 340.8mn SDR (US$456mn). According to the board, “The three-year arrangement will help support the economic recovery and policies to reduce public debt and financing vulnerabilities, creating space for priority investments in human capital, climate adaptation and infrastructure.”

Currencies: As the year approaches the half year mark, year to date spot performance of the various African currencies has been split. On the one hand, despite dollar strength, the official naira rate and metical rate have slightly strengthened against the dollar. 

Botswana: Botswana’s economy rebounded by 11.4% in 2021 (compared to -8.7% in 2020), owing primarily to a significant recovery in the mining sector (29.9% y/y). The mining sector benefitted from a recovery in global diamond demand, and prices, coupled with the resumption of local copper mining activities (in 3Q21). 

Namibia: With a weak economic backdrop and rising cost pressures, the private sector in Namibia continues to struggle as can be seen with the poor credit growth. Borrowing from businesses and households is low – coming in at 2.1% at the end of March. Despite lowering interest rates during the onset of the pandemic, the market has struggled to gain momentum with credit growth averaging 2.5% over the past 12 months. 

Botswana: The Bank of Botswana’s (BoB) Monetary Policy Committee (MPC) hiked the policy rate by 51bp at a meeting held on 28 April 2022. This follows the implementation of reforms highlighted in the 2022 Monetary Policy Statement (MPS) aimed at improving Botswana’s monetary policy transmission. 

Zambia: Zambia’s Inflation rate for April was recorded at 11.5%y/y - 1.60ppt lower than the March print. The reduction can be attributed to reductions in both food and non-food categories which decelerated from 15.3% to 14.1% and 10.3% to 8.2% respectively over the same period. Inflation is at its lowest level since November 2019 on the back of base effects and currency appreciation which have outweighed rising global energy prices.

Kwacha: The recent kwacha gains confirm our view that market sentiment is still a key driver for the currency’s performance. Relative to other economies on the continent, the Zambian economy is viewed positively despite facing the same global risks such as food and fuel inflation.

Commodities: Global markets seem to be pricing-in risks around China’s economic growth momentum resulting in key commodity prices slipping in April. Price growth across most base metals will likely still be driven by supply chain constraints keeping prices more of less elevated.

Côte d'Ivoire: Fitch has affirmed the country’s sovereign rating at “BB-” with a stable outlook for the economy. The rating affirmation is largely based on the confidence the agency has on the authorities to rein-in expenditure after the impact of the pandemic led to additional spending. 

Ghana: The economy bounced-back in 2021, recording 5.4%y/y, as the services industry spurred the recovery. GDP growth rates were broadly aligned with our expectation, coming-in only 0.2 ppt lower than what we had initially anticipated. Under the services industry, “Trade; Repair of Vehicles, Household Goods”, posted a strong recovery of 5.9% in 2021 versus a contraction of 2.9%y/y in 2020.

Namibia: Despite an 8% increase in domestic fuel prices between February and March, Namibia’s March inflation print remained unchanged from February at 4.5% y/y. The month-on-month increase in fuel prices was counteracted by a marked slowdown in food prices from 5.4% y/y in February to 4.6% y/y in March, largely owing to disinflation in meat, fish, dairy, sugar, fruit, vegetable and non-alcoholic beverage sub-categories. 

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. 

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. 

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. 

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, 

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. 

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. 

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