The Editorial Team

Outlook April Cryptos – Bitcoin Taking the Gold

LAGOS (Capital Markets in Africa): The adage that money flows to where it’s treated best describes what we see as firming underpinnings for the price of Bitcoin. It’s not necessarily bearish for gold, which is backing into layers of support below $1,700 an ounce, but most indicators show a shifting global tide that favors the nascent digital currency as a reserve asset. 1. Digital vs. Analog: Bitcoin’s Upper Hand Bitcoin’s relationship to gold is similar…

Biden Tax Plan Seen Hitting Tech, Pharmaceutical Companies

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LAGOS (Capital Markets in Africa) — The tax plan President Joe Biden laid out last week will likely hit technology and pharmaceutical companies particularly hard, although the challenge for legislators will be to minimize loopholes that could diminish the impact, tax experts said. Much of the most valuable assets at pharmaceutical and tech companies is intellectual property, like patents and algorithms — intangibles that make it easier for them to structure global operations in a…

Oil Rebounds Amid Broad Commodities Rally Ahead of Iran Talks

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LAGOS (Capital Markets in Africa) — Oil rebounded, mirroring a broader rally in commodities, ahead of talks on reviving the Iranian nuclear accord. West Texas Intermediate rose 2.3%, with most other commodities also climbing. Crude had plunged on Monday amid a resurgence in Covid infections in Europe and an imminent increase in OPEC+ supplies, which could swell further with an agreement with Iran. Multiparty negotiations take place in Vienna later on Tuesday, though the chances of a breakthrough are seen by analysts…

Why Nigeria Exchange Rate Policy Is Such a Minefield: QuickTake

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LAGOS (Capital Markets in Africa) — Navigating Nigeria’s foreign exchange rate policy is tricky. There are multiple exchange rates; officials issue confusing and contradictory statements; promised reforms don’t materialize; and the central bank and finance ministry don’t always appear to see eye-to-eye on how to manage the naira. Economic fallout from the pandemic, including a deterioration in state finances, has made the need for clarity all the more pressing. 1. Why does Nigeria have multiple…

Bearish Lagos Traders See Gloom Persisting for Nigerian Stocks

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LAGOS (Capital Markets in Africa) — Nigerian stocks look unlikely to shake off their poor start to 2021 anytime soon, with an investor preference for returns available in the local debt market set to persist, according to analysts and investors. The benchmark Nigeria Stock Exchange All Share Index slipped 3% in the first quarter and the conclusion of a positive annual reporting season leaves few incentives to tempt investors to bet on slightly higher returns…

Mozambique’s World-Topping Currency Shrugs Off Gas-Project Raid

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MAPUTO (Capital Markets in Africa) — A deadly raid by insurgents that stopped work at a gas project that Mozambique depends on for an economic revival has done little to derail a world-beating rally in the country’s currency. The metical has appreciated 14% against the dollar since the beginning of February, making it the world’s best performing currency in the period. And its stellar run isn’t over yet, according to Rand Merchant Bank’s Johannesburg-based analysts Neville Mandimika and Daniel Kavishe….

Old Mutual Fund Says South Africa Needs Gas as a Transition Fuel

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JOHANNESBURG (Capital Markets in Africa) — A key funder of South Africa’s renewable energy drive is backing natural gas as the fuel needed to help the country bridge the transition from coal power generation to the use of wind and solar. Old Mutual Ltd.’s African Infrastructure Investment Managers will consider funding companies that compete for the right to produce 3,000 megawatts of electricity from gas in an upcoming bid round planned by the government, said Vuyo Ntoi, co-managing…

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