The Markets

NEW YORK (Capital Markets in Africa) – U.S. money markets are taking a breather following last week’s volatility, but the Federal Reserve remains on alert and is examining what implications the turmoil may have for the central bank and the financial system. Rates on repurchase agreements held steady on Monday after stabilizing late last week in the wake of an unprecedented market spike. A daily Federal Reserve operation — aimed at keeping funding markets on an even…

LONDON (Capital Markets in Africa) – Wall Street could soon get one of its most consequential wins of the Trump era as regulators are considering ripping up a rule that’s forced banks to set aside billions of dollars for swaps trades, according to people familiar with the matter. At issue is a requirement approved during the Obama administration that’s made lenders post tens of billions in the margin when engaging in derivatives transactions with their…

CAIRO (Capital Markets in Africa) – Egypt’s inflation eased in August to its lowest level since the start of 2013, paving the way for what could be the second-biggest push to cut interest rates across emerging markets. Consumer prices in urban parts of Egypt rose 7.5% from a year earlier, the state-run CAPMAS statistics agency said Tuesday. Core inflation, the gauge measured by the central bank that strips out volatile and regulated items, slowed to an annual…

NEW YORK (Capital Markets in Africa) – Money managers at BNY Mellon and Pacific Investment Management Co. have snapped up Japanese bonds. Both companies have made the country the second-largest geographic allocation in some of their biggest international fixed-income funds. Ordinarily that wouldn’t seem remarkable, but right now many of Japan’s government bonds have a negative yield—it actually costs money to hold them to maturity. BNY Mellon and Pimco aren’t alone. Investors from outside Japan more than doubled purchases…

LONDON (Capital Markets in Africa) – Goldman Sachs Group Inc. has a simple yet firm message for its wealthy clients: stick with U.S. equities. “As we’ve gone through various crises, we’ve still told clients to stay invested and not get out of U.S. equities, it’s too early,” said Sharmin Mossavar-Rahmani, chief investment officer for Goldman’s Private Wealth Management, which oversees about $500 billion and caters to high-net-worth individuals, families and endowments. “There’s a strong message there…

LAGOS (Capital Markets in Africa) – Nigeria wants to offer naira futures of as long as 10 years to help cushion against foreign-exchange risks and attract longer-term funding to Africa’s top oil producer. The Central Bank of Nigeria started selling foreign-currency futures contracts on the FMDQ Securities Exchange Plc in 2017 with a maximum duration of 13 months. This was to alleviate pressure on the naira by spreading dollar purchases over a period time, enabling investors to hedge against…

LAGOS (Capital Markets in Africa) – Investors in Ireland’s bonds are sitting on double-digit returns this year after a global debt rally and now they are starting to get nervous. Fears of a bubble in bond markets have been growing on doubts over the extent of future monetary easing. In Ireland’s case, the U.K.’s political turmoil is an added hurdle as the neighboring economies are intertwined and a crash exit from the European Union could…