The Markets | - Part 107

Market May Lose Linker Love as South Africa Inflation Slows

JOHANESBURG (Capital Markets in Africa) – South African government bonds that offer protection against price increases are outperforming nominal debt so far this year — but that may prove to be a false start. Demand for inflation-linked bonds increased as inflation in Africa’s most-industrialized economy accelerated in 2018, reaching an 18-month high of 5.2 percent in November. But the rate probably plunged to 4.5 percent in December, data will show Wednesday, according to the median estimate of 19 economists…

Egypt Sees More Pound Volatility After Repatriation Fund Ends

Posted on by The Editorial Team

CAIRO (Capital Markets in Africa) – Egypt’s stagnant exchange rate is likely to see more movement after a system that guaranteed foreign investors could repatriate dollars was terminated, but the central bank stands ready to fend off speculators and ensure debt holders don’t lose out, Governor Tarek Amer said. Amer’s remarks could help reassure foreign investors scrutinizing Egypt’seconomic policy as the country wraps up a three-year, $12 billion economic overhaul agreement with the International Monetary Fund this year….

EGYPT INSIGHT: Pound Volatility Coming, Dollar Ties to Loosen

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CAIRO (Capital Markets in Africa) – More volatility in the Egyptian pound is coming, but the central bank could use foreign exchange reserves and interest rates to support the currency. That’s the message from the governor of the Central Bank of Egypt. Here’s our initial take on what the governor told Bloomberg News: The Egyptian pound exhibited remarkable stability last year, hovering around 18 to the dollar, even as other emerging market currencies had a rough ride…

Traders Blind to South Africa Rate Pressure May Be in for a Jolt

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JOHANNESBURG (Capital Markets in Africa) – Fixed-income traders who have become complacent about interest rate increases in South Africa are setting themselves up for a “negative monetary surprise,” according to Nedbank Group Ltd. — and that could cost them. The South African Reserve Bank will meet for this first time this year on Thursday, with all 18 economists in a Bloomberg survey predicting policy makers will hold the benchmark rate at 6.75 percent. But a hike could…

No Currency, Just a Currency Crisis: Zimbabwe’s Woes Deepen

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HARARE (Capital Markets in Africa) – Not having a currency of its own hasn’t stopped Zimbabwe from sliding into a currency crisis. A scarcity of foreign exchange has led to long queues for fuel, bread and medicine and sent prices surging. Protests erupted across the southern African country on Monday, leaving possibly five people dead, after the government more than doubled gasoline prices to $3.31 a liter ($12.58 a gallon) over the weekend, the highest in…

Egypt Plans Up to $7 Billion in International Bond Sale in 1Q

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CAIRO (Capital Markets in Africa) – Egypt plans to issue between $3 billion and $7 billion worth of international bonds in the first quarter of the year, Finance Minister Mohamed Maait said Sunday, as an outflow of foreign capital in local debt markets could test its ability to meet budget deficit reduction targets. The cabinet has given “us the flexibility to issue what we need within this range” and also flexibility regarding the currencies, Maait said in…

Nigeria Misses Out on Emerging-Market Rally as Vote Nears

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LAGOS (Capital Markets in Africa)- Emerging-market assets may be enjoying a strong start to the year, but one country missing out on the rally is Nigeria. With investors fretting about tight elections just a month away, low oil prices and escalating violence, there’s little to suggest there’ll be an immediate turnaround. The main stock index in Lagos, the commercial capital, has lost 4.1 percent since the end of 2018, which is the biggest drop globally after Serbia, Romania and Bulgaria,…

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