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United Kingdom Manufacturing Sums Up Interest-Rate Dilemma for the BOE

LONDON (Capital Markets in Africa) – For a picture book example of the dilemma facing Bank of England policy makers, look no further than the U.K. manufacturing industry. On the downside for the economy, demand and confidence at factories is declining and investment is weakening, according to a survey from the Confederation of British Industry. But, in a sign of a potential squeeze that could intensify price pressures, the percentage of firms operating below capacity is the…

For Stocks Pumped by Draghi’s Stimulus, The Only Way May Be Down

Posted on by The Editorial Team

LAGOS (Capital Markets in Africa) – Ahead of this week’s European Central Bank meeting, investors mostly see the region’s equities weathering President Mario Draghi’s tapering signals. But in the short term, there are signals aplenty that the shares may be ripe for a pullback, particularly if the euro resumes its rally. Strategists on average now expect the Euro Stoxx 50 to decline by year-end. Here are five charts that indicate overheating in the stock market. Euro-area stocks are no longer…

BOE’s November Rate Hike Isn’t Set in Stone After Crunch Week

Posted on by The Editorial Team

LONDON (Capital Markets in Africa) – After a crucial week for the Bank of England, a November interest-rate increase no longer looks like a sure thing. Inflation may have hit 3 percent, but for some policymakers at the central bank, the domestic price pressures that justify raising now aren’t there. That view was backed up by data Wednesday that showed wage growth slowing. Dave Ramsden, the Monetary Policy Committee’s newest member, had said a day earlier that…

South Africa September Inflation Uptick Limits Room for Rate Cuts

Posted on by The Editorial Team

JOHANNESBURG (Capital Markets in Africa) – South African inflation quickened for a second consecutive month in September, reducing room for the nation’s central bank to ease policy. The inflation rate rose to 5.1 percent from 4.8 percent the previous month, Pretoria-based Statistics South Africa said in a report on its website on Wednesday. The median of 24 economist’s estimates in a Bloomberg survey was 5 percent. Prices rose 0.5 percent in the month, the highest monthly rate since March….

Kenyan Central Bank Moves to Ease Investors’ Vote Concerns

Posted on by The Editorial Team

NAIROBI (Capital Markets in Africa) – Kenya’s central bank is communicating a sense of normalcy and continuity to investors amid uncertainty about the country’s protracted elections, Governor Patrick Njoroge said. Institutions including the nation’s courts show Kenya is a “mature” democracy, Njoroge said in an interview with Bloomberg TV in London on Tuesday. While liquidity in the country’s money markets is tight at the moment, it has “nothing to do with the political circumstances,” he said. Central…

South Africa’s Mminele Downplays Chance of Imminent Rate Cuts

Posted on by The Editorial Team

JOHANNESBURG (Capital Markets in Africa) – Uncertainty limits the opportunity for rate cuts in South Africa even as inflation remains within the central bank’s target band, according to Deputy Governor Daniel Mminele. The bank unexpectedly kept its key rate unchanged at 6.75 percent at its last policy meeting in September, concerned about higher inflation expectations. Price growth quickened to 4.8 percent in August, its fifth month within the central bank’s target range of 3 percent to 6 percent. “Amid…

Carney’s Countdown to BOE Rate Hike Faces Make or Break Week

Posted on by The Editorial Team

LAGOS (Capital Markets in Africa) – Mark Carney is heading into a crucial week in the countdown to a possible Bank of England rate increase in early November. After the International Monetary Fund meetings where most central bankers fretted about weak inflation even amid robust global growth, the governor returns to an economy that’s almost the mirror opposite. While Brexit is weighing on U.K. businesses, price growth is above target — something for lawmakers to press him on…

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