The Editorial Team |

Moody’s downgrades Ethiopia’s rating to B2; rating on review for further downgrade

ADDIS ABABA (Capital Markets in Africa) — Moody’s Investors Service (“Moody’s”) has downgraded the long-term issuer and senior unsecured ratings of the Government of Ethiopia to B2 from B1 and placed the ratings on review for further downgrade. The downgrade to B2 reflects heightened external and government liquidity risks further aggravated by the coronavirus outbreak which has severely hit the economy’s foreign currency receipts, raised the government’s spending needs, and curtailed its financing options. Ethiopia…

Moody’s changes outlook on Kenya’s rating to negative from stable; affirms the B2 rating

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Nairobi (Capital Markets of Nigeria) — Moody’s Investors Service, (“Moody’s”) has changed the outlook on the Government of Kenya’s ratings to negative from stable. Concurrently, Moody’s has affirmed Kenya’s B2 issuer and senior unsecured ratings. The negative outlook reflects the rising financing risks posed by Kenya’s large gross borrowing requirements, which include amortization of external bilateral debt and the need to refinance a large stock of short-term domestic debt, at a time when the fiscal…

Nigeria Stares Into the Abyss of a Life Without Oil Revenue

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LAGOS (Capital Markets in Africa) — Africa’s most populous nation is getting almost nothing from its massive oil wealth. While headline Brent-crude futures have rallied sharply in the past few weeks — rising above $30 a barrel on Tuesday — a glut of Nigerian oil is fetching about $10 less than that. It’s a level that means fiscal revenue for the continent’s biggest economy has cratered. “It’s now dawned on everyone across the country how…

Gatwick Cutbacks Mount With Virgin Atlantic the Latest to Flee

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LONDON (Capital Markets in Africa) — The coronavirus is muddying the outlook for London’s second-biggest airport. Richard Branson’s Virgin Atlantic Airways Ltd. became the latest carrier to back away from London Gatwick, saying Tuesday it will shutter its operation at least temporarily to focus on the much larger Heathrow. With arch-rival, British Airways reportedly looking to do the same, and Gatwick’s third-largest tenant, Norwegian Air Shuttle ASA, retrenching to survive the winter, the south London hub is…

China Ambassador to U.S. Urges End to ‘Blame Game’ Over Pandemic

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LAGOS (Capital Markets in Africa) — China’s ambassador to Washington called for an end to the “blame game” over the coronavirus, in the country’s most high-profile response since U.S. President Donald Trump escalated his criticism of Beijing. Ambassador Cui Tiankai said in a column published in the Washington Post that allegations blaming China for the outbreak’s spread risked “decoupling” the world’s two largest economies. Increased suspicions also threatened to hurt U.S.-China cooperation to fight the disease and restart the…

Oil Rally Runs Out of Steam After Prices Doubled Over Five Days

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LAGOS (Capital Markets in Africa) — Oil’s rally ran out of steam — after prices doubled over five days — as optimism that output cuts are easing the supply glut was balanced by trepidation over what promises to be a long and uncertain recovery. Futures in New York fell toward $24 a barrel after swinging between gains and losses in Asian trading. Diamondback Energy Inc. and Parsley Energy Inc. became the latest U.S. drillers to…

South African Bonds Back in Favor, Defying Index Exclusion

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JOHANNESBURG (Capital Markets in Africa) — Investors are piling back into South African bonds, shrugging off two credit downgrades, a yawning budget deficit and ejection from an index tracked by trillions of dollars of funds. Bonds coming due in 2026 have clawed back all their losses for the year, while yields on 10-year securities have dropped back into single digits for the first time since March as the government attracted record bids at a weekly debt…

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