Economy

CAIRO (Capital Markets in Africa) – Egypt’s inflation rate accelerated for the first time in five months, rising 3.6% in November as the effect of last year’s surge in prices faded but offering the central bank little reason to reverse a monetary easing cycle. The annual rate for urban inflation rose from 3.1% the month before, the state-run statistics bureau said Tuesday. Consumer prices fell 0.3% month-on-month from a 1% rise in October — its…

NEW YORK (Capital Markets in Africa) – If 2019 was the year the yield curve went mainstream, with an inversion sending a stark recession warning, then 2020 is already shaping up as a welcome return to normality. Nobody is willing to call the all-clear on the global economy yet given a trade deal between the U.S. and China is still to be reached. Even so, the prospect of longer-term yields stretching their premium over shorter…

JOHANNESBURG (Capital Markets in Africa) – South Africa could move deeper into junk territory as the nation looks set to lose the only stable outlook on its credit ratings this week. Of the 22 economists in a Bloomberg survey, 16 expect S&P Global Ratings to change its outlook on the country’s credit rating to negative on Friday. That means the next move from the company, which already assesses South Africa’s foreign-currency debt at two levels below…

JOHANNESBURG (Capital Markets in Africa) – For a quarter-century, South Africa has been able to count on an investment-grade rating from Moody’s Investors Service. Bond buyers lately may be forgiven for wondering why. Financial markets have been pricing in a downgrade for months, and the other two major rating companies have had South Africa at junk status for two years. Should Moody’s follow suit, the nation would suffer enormous financial consequences. For one, the country would lose its place…

NAIROBI (Capital Markets in Africa) – Kenya’s debt-ceiling review not only shifts the goalposts but also changes the rules on how goals are scored, and that could move the government closer to debt distress. Lawmakers last week approved the government’s plan to present the debt limit in absolute figures and not as a percentage of gross domestic product. The National Treasury proposed a ceiling of 9 trillion shillings ($86 billion), which allows it to increase…

LAGOS (Capital Markets in Africa) – The shutdown of Nigeria’s land borders to tackle rampant food smuggling and encourage an agricultural revival in Africa’s top oil producer is having an unintended side effect: higher inflation. A spike in food prices saw the annual consumer-inflation rate rise to 11.2% in September, after falling to a 3 1/2-year low in the preceding month, the National Bureau of Statistics said Tuesday. Food-price growth accelerated for the first time…

NEW YORK (Capital Markets in Africa) – The U.S. economy’s growth rate is losing speed, prompting questions over how slow it can go and still avoid crashing into a recession. Whereas expansion below 2% used to almost guarantee the economy would subsequently contract, some economists now reckon the U.S. can wobble around 1%-1.5% without falling over. The decline in the economy’s so-called stall speed is a relief after data released Tuesday signaled the weakest manufacturing…