Economy

LAGOS (Capital Markets in Africa) — Africa’s largest economy had a week of good and bad news as the oil price rebounded to the highest level in two months, while the negative impact of the coronavirus pandemic on consumers and business activity became clearer. Crude prices have doubled since hitting a two-decade low in April, climbing past $40 a barrel after OPEC+ cuts started taking excess supplies from the market. With oil bringing in 90%…

LAGOS (Capital Markets in Africa) — For advanced economies dealing with economic disruptions from the coronavirus pandemic, the response of choice has been massive stimulus packages. Africa is doing without them. While central banks and governments in North America, Asia and Europe have offered trillions of dollars to prop up businesses hit by lockdowns and provide a safety net for the swelling ranks of the unemployed, a lack of liquidity restricts African governments from providing…

JOHANNESBURG (Capital Markets in Africa) — South Africa’s government announced plans to further ease a nationwide lockdown as the fallout from shuttering much of the economy threatens to outweigh the damage wrought by the coronavirus. Consultations will begin in the coming days about moving most of the country to disease alert level 3 by the end of the month, from level 4, and allow a number of additional industries to resume operations, President Cyril Ramaphosa…

JOHANNESBURG (Capital Markets in Africa) — Business leaders are ratcheting up pressure on South African President Cyril Ramaphosa to reopen the economy more swiftly, warning that the devastation wreaked by a lockdown aimed at curbing the spread of the coronavirus could exceed the damage caused by the pandemic itself. Africa’s most industrialized economy was brought to a near halt on March 27 as the government sought to prevent a surge of infections swamping an already…

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…

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…

NAIROBI (Capital Markets in Africa) — Kenya’s inflation accelerated to 5.6% in April from a revised 5.5% in the previous month as food prices rose by double digits, the Kenya National Bureau of Statistics said Thursday in an emailed statement. Prices rose 0.9% in the month. Prices of food and non-alcoholic drinks, which make up a third of the inflation basket, climbed almost 12%. The transport index climbed to 5.4% even after the government cut gasoline…