Central Bank | - Part 16

Australia Rejoins Global Disinflation Fight With Record Low Rate

LAGOS, Nigeria, Capital Markets in Africa: Australia’s record low interest-rate following Tuesday’s cut underscores the demise of its economic exceptionalism: swept up in a wave of global disinflation, policy makers had little choice but to step in line with international peers as a strengthening currency threatens to push prices lower still. It’s a far cry from five years ago when the benchmark rate was a developed-world high 4.75 percent and the local dollar was worth more than…

Pound Slumps as Egyptian Banks ‘Scrape Barrel’ Over FX Shortage

Posted on by The Editorial Team

CARIO, Egypt, Capital Markets in Africa: The Egyptian pound extended a record low on the black market, as tighter restrictions on the use of local debit and credit cards overseas and comments by the central bank governor stoked speculation of a devaluation. The pound fell to 12.99 per dollar on Tuesday from 12.02 last week, according to the average quote of five currency traders in Cairo and Alexandria. That’s the lowest since Bloomberg started tracking black…

Nigeria Raises Key Interest Rate to Lure ‘Lukewarm’ Investors in July

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LAGOS, Nigeria, Capital Markets in Africa: Nigeria raised its monetary policy rate to lure foreign investors and prop up its currency, even as the economy risks slipping into recession. The Monetary Policy Committee increased the key lending rate to 14 percent from 12 percent, Central Bank of Nigeria Governor Godwin Emefiele told reporters in the capital, Abuja, on Tuesday. That was in line with the forecast of two of the 15 economists in a Bloomberg survey. Two predicted a 100 basis-point…

Kenya Pauses Monetary Easing, Sees Moderate Inflation Pressure

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NAIROBI, Kenya, Capital Markets in Africa: The Central Bank of Kenya maintained its benchmark interest rate at 10.5 percent with an eye on accelerating inflation and concerns that Britain’s exit from the European Union may trigger capital flight. The decision by the monetary policy committee led by Governor Patrick Njoroge was anticipated by seven of eight analysts surveyed by Bloomberg. One economist predicted a 50 basis point reduction at Monday’s meeting, following one percentage point cut at the previous gathering in…

South Africa May Move Rate Focus to Recession Risk

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Johannesburg, Capital Markets in Africa: South Africa’s rate-hiking cycle may be coming to an end amid the threat of the country’s first recession in seven years. After increasing the benchmark rate six times since the start of 2014, policy makers in Africa’s only Group of 20 economy are poised to keep it unchanged this week as a stronger currency gives them room to focus on the risks to growth. Those headwinds include weak export demand, the worst drought in…

Mauritius Cuts Rates by Biggest Margin Since 2012 on Brexit in July

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Mauritius, Capital Markets in Africa: The Bank of Mauritius reduced its benchmark interest rate by the biggest margin in more than four years, saying Britain’s decision to leave the European Union has damaged the Indian Ocean island nation’s growth outlook. The Monetary Policy Committee unanimously decided to lower its benchmark rate to 4 percent from 4.4 percent, Governor Rameswurlall Basant Roi told reporters Wednesday in the capital, Port Louis. The gauge had remained unchanged since November 2015,…

Ghana May Hold Rate to Aid Economy Growing Slowest Since ’83

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ACCRA, Ghana, Capital Markets in Africa: Slowing inflation could give Bank of Ghana Governor Abdul Nashiru Issahaku room to continue supporting an economy forecast to expand at the slowest pace since 1983. The Bank of Ghana will probably leave its benchmark interest rate unchanged at 26 percent for a fourth consecutive meeting on July 18, all four analysts surveyed by Bloomberg said. The central bank raised the rate four times by a total of 500 basis points last year to prop…

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