South Africa

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November 21, 2024

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SARB MPC Review: Fall in Inflation Sparked Easing Cycle to Continue on November 21
Paying Article

November 21, 2024 3:58 PM UTC

Bottom line: South African Reserve Bank (SARB) cut the key rate by 25 bps to 7.75% at its final meeting of the year on November 21 given power cuts (loadshedding) are suspended, inflation expectations decelerated, and CPI softened further to 2.8% YoY in October due to falling fuel prices and slowing

November 15, 2024

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SARB MPC Preview: Easing Cycle to Continue on November 21
Paying Article

November 15, 2024 4:04 PM UTC

Bottom line: After South African Reserve Bank (SARB) cut the key rate to 8.0% on September 19 following seven consecutive meetings at a 15-year peak of 8.25% given that September inflation hit below the midpoint of target band of 3% - 6%, power cuts (loadshedding) are suspended and inflation expecta

October 30, 2024

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Medium Term Budget Policy Statement Foresees Wider Budget Deficit but a Better Growth Prospect
Paying Article

October 30, 2024 5:21 PM UTC

Bottom line: The coalition government announced its first Medium-Term Budget Policy Statement (MTBPS) on October 30, setting government policy goals and forecasts over the next three years. According to MTBPS, South African Treasury sees consolidated deficit at 5% of GDP in the fiscal year ending in

October 28, 2024

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BRICS Summit 2024: Kazan Declaration not a Game Changer
Freemium Article

October 28, 2024 11:41 AM UTC

Bottom Line: The BRICS Summit, which was held in Kazan on October 22-24, was the first summit following BRICS has expanded to include Ethiopia, Iran, Egypt and the United Arab Emirates. Despite expectations, Kazan deceleration, which was a joint statement signed after the summit, is not a game-chan

October 23, 2024

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Deceleration Trend Continues: South Africa’s Inflation Cooled to 3.8% YoY in September
Paying Article

October 23, 2024 2:29 PM UTC

Bottom Line: After inflation decreased to 4.4% YoY in August, the downward trend continued in September and CPI hit 3.8% YoY given suspended power cuts (loadshedding), a relatively stable Rand (ZAR), decrease in inflation expectations in Q3 coupled with Fed started cutting rates. Taking into account

October 18, 2024

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South Africa: Medium Term Budget Policy Statement to be Announced on October 30
Paying Article

October 18, 2024 4:50 PM UTC

Bottom line: The coalition government will announce its first Medium-Term Budget Policy Statement (MTBPS) in Parliament on October 30, which is anticipated to set government policy goals and priorities and forecast macroeconomic trajectory and the fiscal framework over the next three years, includin

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Sub Sahara Africa: Country Risk Ratings
Paying Article

October 18, 2024 10:00 AM UTC

We provide country risk reviews for Sub Sahara Africa countries including Nigeria/South Africa.  

October 08, 2024

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SARB in 2025: Rate Cuts Will Continue
Freemium Article

October 8, 2024 5:25 PM UTC

Bottom line: After South African Reserve Bank (SARB) started cutting the key rate on September 19 and decreased it from 8.25% to 8.0% given fall in inflation below midpoint of target band of 3% - 6%, suspended power cuts (loadshedding) and deceleration in inflation expectation, we now foresee the ra

October 02, 2024

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Markets: Rate Cuts or Geopolitics?
Paying Article

October 2, 2024 9:36 AM UTC

Israel will likely counteract Iran, which will prompt a further missile attack by Iran.  However, our bias remains that Israel main aim is to have a buffer zone in southern Lebanon up to the Latani river and not fight a prolonged war with Iran.  This limits the economic fallout globally and on oil

September 27, 2024

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September Outlook: Rate Cuts But How Far?
Paying Article

September 27, 2024 7:44 AM UTC

The 15 chapters of our September Outlook have now been published.  See the headlines and weblinks enclosed for links to the articles on economic, policy and markets for the 23 countries that we cover.

September 26, 2024

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EM FX Outlook: Fed Easing Helps but Divergent Trends
Paying Article

September 26, 2024 8:00 AM UTC

  USD strength is ebbing across the board, which provides a positive force for most EM currencies on a spot basis.  However, where inflation differentials are large, the downward pressure will remain in 2025 e.g. Turkish Lira (TRY).  Where inflation differentials are modest against the U.S., but

September 25, 2024

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Outlook Overview: Rate Cuts But How Far?
Paying Article

September 25, 2024 7:30 AM UTC

·        The U.S. economy is slowing, with the critical question being whether this is a soft or harder landing.  Our broad analysis leaves us inclined to the soft landing view into 2025, though we shall watch real sector data closely over the next 3-6 months to check the trajectory.  Else

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EMEA Outlook: Rate Cuts Loading in 2025
Paying Article

September 25, 2024 7:00 AM UTC

·     In Turkiye, we still foresee upside risks emanating from buoyant domestic demand, the stickiness of services inflation, and adverse geopolitical impacts leading average inflation to stand at 58.8% and 35.3% in 2024 and 2025, respectively. We think Central Bank of Republic of Turkiye (CBRT

September 19, 2024

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Time Has Come: SARB Cut the Key Rate to 8.0% on September 19
Paying Article

September 19, 2024 3:57 PM UTC

Bottom line: As we expected, South African Reserve Bank (SARB) started cutting the key rate at the upcoming MPC meeting on September 19 and decreased it from 8.25% to 8.0% given recent fall in inflation, suspended power cuts (loadshedding) after March, deceleration in inflation expectations and a re

September 18, 2024

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South Africa’s Inflation Dips Below Midpoint Target with 4.4% YoY in August
Paying Article

September 18, 2024 9:01 AM UTC

Bottom Line: After inflation decreased to 4.6% YoY in July due to slowdown in costs for food, fuel, housing and transportation, the downward trend continued in August and CPI hit 4.4% YoY given suspended power cuts (loadshedding), a relatively stable Rand (ZAR), decrease in inflation expectations co

September 15, 2024

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Sep 27 Outlook Webinar: Rate Cuts But How Far?
Paying Article

September 15, 2024 10:30 AM UTC

    Uncertainty about whether the U.S. economy will have a soft or hard landing is growing as the market approaches Q4.  This is shaping the debate regarding the scale of easing through the remainder of 2024 and 2025 by the Fed.  European easing is underway, but how much further will central ba

September 12, 2024

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Time Has Come: SARB will Likely Decrease the Key Rate to 8.0% on September 19
Paying Article

September 12, 2024 7:09 PM UTC

Bottom line: South African Reserve Bank (SARB) will likely start cutting the key rate at the upcoming MPC meeting on September 19 and decrease the rate from 8.25% to 8.0% given recent fall in inflation, suspended power cuts (loadshedding) after March, deceleration in inflation expectations and a rel

August 14, 2024

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EM Markets Divergence with China Harder Landing Concerns
Paying Article

August 14, 2024 3:35 PM UTC

Global market turbulence has had a spillover impact into EM, but also some EM assets have benefitted from rotation away from the U.S.  What are the prospects in the coming months?
We see scope for a 2nd wave of U.S. equity and Japanese Yen (JPY) correction, which are a mixed influence for EM assets

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South Africa’s Inflation is Expected to Continue its Downward Trend in July
Paying Article

August 14, 2024 1:56 PM UTC

Bottom Line: After inflation decreased to 5.1% YoY in June due to slowdown in costs for food, fuel and transportation, we now foresee that the downward trend will continue in July and CPI will further slow down to 4.9% - 5.0% Yr/Yr given suspended power cuts (loadshedding), a stable Rand (ZAR), fall

July 30, 2024

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South Africa’s Load Shedding Suspended for 121 Consecutive Days, but Risks Remain Alive
Freemium Article

July 30, 2024 3:42 PM UTC

Bottom Line:  Despite power cuts (load shedding) was a major headwind for South African economy in Q1, it appears the situation got better in Q2 as Eskom announced on July 26 that load shedding remained suspended for 121 consecutive days since March 26 reflecting an improvement in the reliability a

July 24, 2024

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South Africa’s Inflation Slightly Eased to %5.1 YoY in June
Paying Article

July 24, 2024 11:25 AM UTC

Bottom Line: According to the inflation figures announced by Department of Statistics of South Africa (Stats SA) on July 24, CPI marginally decreased to 5.1% YoY in June due to slowdown in costs for food, fuel and transportation coupled with suspended power cuts (load shedding) in June. The inflatio

July 11, 2024

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South Africa: Parliament to Open on July 18
Paying Article

July 11, 2024 9:41 AM UTC

Bottom Line: After African National Congress (ANC) and Democratic Alliance (DA) formed a government of national unity (GNU) along with other smaller parties, and president Ramaphosa announced the cabinet on June 30, South Africa should now quickly turn its attention to economic urgencies. The parlia

July 10, 2024

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Nigeria and South Africa: Country Risk Ratings
Paying Article

July 10, 2024 1:42 PM UTC

We provide extra country risk reviews for Sub Sahara Africa countries including Nigeria and South Africa.    

July 02, 2024

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Webinar Recording June Outlook: Cyclical and Structural Forces
Paying Article

July 2, 2024 7:30 AM UTC

July 01, 2024

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Coalition’s Determination will be Key for Narrowing South Africa’s Current Account Deficit
Paying Article

July 1, 2024 10:32 AM UTC

Bottom Line: Current account deficits (CAD) continue to be a major headwind for South African economy ignited by logistical constraints, power cuts (load shedding), and weaker external demand especially from China and the EU. We think CA will be still bolstered by a trade surplus in H2 2024, support

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EM After the Elections: Fiscal Focus and Inflation Questions
Paying Article

July 1, 2024 8:05 AM UTC

Enhancing fiscal credibility is key post-election in India and S Africa, but also for Brazil.  India, will do this in the 3 week of July, but S Africa needs to move from ANC/DA led coalition optimism to reality quickly. Brazil needs to stop the vicious circle of sentiment building up on fiscal slip

June 26, 2024

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June Outlook: Cyclical and Structural Forces
Paying Article

June 26, 2024 7:58 AM UTC

The 15 chapters of our June Outlook have now been published.  See the headlines and weblinks enclosed for links to the articles on economic, policy and markets for the 23 countries that we cover

June 25, 2024

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Outlook Overview: Cyclical and Structural Forces
Paying Article

June 25, 2024 10:15 AM UTC

•    The global economy is showing signs of healing, as inflation comes back towards targets and growth recovers momentum in some economies. Nevertheless, the cyclical headwind of lagged monetary tightening remains in DM countries, and will likely be one of the forces slowing the U.S. economy

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EMFX Outlook: USD Strength to Ebb with Different EM Impact
Paying Article

June 25, 2024 8:05 AM UTC

 We see Fed rate cuts from September starting to soften USD strength into year end and 2025.  Beneficiaries will include currencies with inflation moving towards target and high real rates or, alternatively, undervalued currencies. This should benefit the Brazilian Real (BRL) and Indonesian Rupiah

June 24, 2024

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EMEA Outlook: Stubborn Inflation Dominates
Paying Article

June 24, 2024 1:00 PM UTC

·     In Turkiye, we expect Central Bank of Republic of Turkiye (CBRT) will likely halt the key rate at 50% until the end of 2024, which is our baseline scenario. We expect a fall in inflation likely after July due to favorable base effects, additional macro prudential measures, public savings

June 19, 2024

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South Africa’s Inflation Stayed Stable at 5.2% in May
Paying Article

June 19, 2024 10:28 AM UTC

Bottom Line: According to the inflation figures announced by Department of Statistics of South Africa (Stats SA) on June 19, the inflation held steady at 5.2% YoY in May, unchanged from April due to suspended power cuts (load shedding) coupled with unchanged food and non-alcoholic beverages (NAB) pr

June 17, 2024

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South Africa: ANC-DA-IFP-PA Coalition Will Run the Government
Paying Article

June 17, 2024 11:23 AM UTC

Bottom Line: As we predicted, African National Congress (ANC) and Democratic Alliance (DA) formed a government of national unity (GNU) with the ANC-lead on June 14, along with two smaller opposition parties, Inkatha Freedom Party (IFP) and Patriotic Alliance (PA). Lawmakers voted to put former presi

May 31, 2024

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South Africa Elections: A Coalition Government is on the Horizon
Paying Article

May 31, 2024 3:03 PM UTC

Bottom line: As we forecasted in our previous pieces, it seems a coalition government with an ANC-lead will be formed following the presidential elections on May 29, according to the preliminary results. It is very likely that ANC will be losing its majority dipping below 50% as it is currently the

May 30, 2024

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SARB Held the Key Rate Stable at 8.25%
Paying Article

May 30, 2024 3:06 PM UTC

Bottom line: As widely expected, South African Reserve Bank (SARB) kept the key rate constant at a 15-year high of 8.25% on May 30 despite inflation rate fell for a second consecutive month in April due to less severe power cuts (load shedding), a firmer South African rand (ZAR) coupled with lower f

May 23, 2024

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Support to ANC is on the Rise
Paying Article

May 23, 2024 6:24 AM UTC

Bottom line: We continue to foresee two possible outcomes of South African presidential elections on May 29, either an African National Congress (ANC) win (40% probability) or a coalition government (60% probability). According to recent polls, ANC continues to be at the risk of losing its majority

May 22, 2024

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South Africa’s Inflation Softened to 5.2% in April, the Lowest Reading in Four Months
Paying Article

May 22, 2024 10:54 AM UTC

Bottom Line: According to the inflation figures announced by Department of Statistics of South Africa (Stats SA) on May 22, the inflation eased to 5.2% YoY in April down from 5.3% in March due to less severe power cuts (load shedding), a firmer South African rand (ZAR) coupled with lower food and no

May 10, 2024

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Asset Allocation 2024: Tricky Seven Months Remaining
Paying Article

May 10, 2024 1:06 PM UTC

Fed easing expectations for 2025 and 2026 can shift from a terminal 4% Fed Funds rate towards 3%, as the U.S. economy slows due to lagged tightening effects.  Combined with Fed easing starting in September this should mean a consistent decline in 2yr yields.  However, 10yr U.S. Treasury yields wil

May 03, 2024

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EMFX: Diverging On Domestic Forces Not Less Fed Easing Hopes
Paying Article

May 3, 2024 10:45 AM UTC

While U.S. economic developments, plus Fed policy prospects, will be important in terms of EM currency developments, domestic politics and fundamentals will also be decisive. These can keep the South Africa Rand volatile in the remainder of 2024, given the risk of a coalition government and African

May 01, 2024

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South Africa’s Fiscal Outlook Under Spotlights as the Elections Are Approaching
Paying Article

May 1, 2024 6:45 PM UTC

Bottom line: South Africa policy makers remain concerned about government debt trajectory, large domestic and international financing needs and elevated country risk premium before fast-approaching elections on May 29. We think South Africa’s general government fiscal balance and debt trajectory w

April 26, 2024

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Headwinds To Long-term Global Growth
Paying Article

April 26, 2024 9:30 AM UTC

Bottom line: While much focus is on the cyclical economic position to determine 2024 monetary policy prospects, the 2025-28 structural growth trajectory differs to the pre 2020 GDP trajectory for major economies.  While global fragmentation has a role to play, aging populations are already having a

April 24, 2024

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Sticky Inflation Causes Concerns over the Horizon
Paying Article

April 24, 2024 9:26 AM UTC

Bottom line: According to the Monetary Policy Review Report by the South African Reserve Bank (SARB) on April 23, the risk of higher inflation still remains and inflation returning to the midpoint of the target band is only expected in the last quarter of 2025. SARB highlighted in its report that ma

April 19, 2024

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Recent Polls in South Africa: ANC’s Popularity Continues to Decline
Paying Article

April 19, 2024 1:14 PM UTC

Bottom line: We continue to foresee two possible outcomes of South African presidential elections on May 29, either an African National Congress (ANC) win or a coalition government. According to recent polls, ANC is at the serious risk of losing its majority dipping below 50%, even as low as 37% acc

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Sub Sahara Africa: Country Risk Ratings
Paying Article

April 19, 2024 9:00 AM UTC

We provide country risk reviews for Sub Sahara Africa countries including S Africa/Nigeria/Ethophia/Sudan and Angola/DRC.  

April 17, 2024

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South Africa’s Inflation Softened to 5.3% in March
Paying Article

April 17, 2024 11:38 AM UTC

Bottom Line: According to the inflation figures announced by Department of Statistics of South Africa (Stats SA) on April 17, the inflation softened to 5.3% YoY in March from a four-month high of 5.6% YoY due to lower food and non-alcoholic beverages (NAB), alcoholic beverages & tobacco, transporta

April 03, 2024

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March Outlook: Europe in Focus, Then Elections Around the World
Paying Article

April 3, 2024 9:00 AM UTC

April 02, 2024

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Asset Allocation: Pausing for Breath
Paying Article

April 2, 2024 9:00 AM UTC

Into Q2, data and policy (actual and perceived) will dominate DM markets. The ECB will likely take the spotlight with a 25bps cut on June 7, as the Fed face a better growth/more fiscal policy expansion and a tighter labor market than the EZ but also with a better productivity backdrop and outlook to

March 27, 2024

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Beware of Inflation: SARB Held the Key Rate Stable at 8.25%
Paying Article

March 27, 2024 3:26 PM UTC

Bottom line: As widely expected, South African Reserve Bank (SARB) kept the key rate constant at 8.25% on March 27. It appears the decision targeted to anchor inflation expectations around the target midpoint, and enhance confidence in achieving the inflation goal as SARB signalled that its fight to

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March Outlook: Europe in Focus, Then Elections Around the World
Paying Article

March 27, 2024 9:00 AM UTC

March 26, 2024

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EM FX Outlook: Domestic Drivers Key
Paying Article

March 26, 2024 9:01 AM UTC

   In terms of spot EM FX projections domestic drivers remain critical, with a desire to avoid appreciation versus the USD for some countries.  Fed easing in H2 2024 should however help EMFX more broadly and allow some recovery in spot rates (e.g. Indonesian Rupiah (IDR), South African Rand (ZAR)

March 25, 2024

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EMEA Outlook: Elections Set the Scene in Q2
Paying Article

March 25, 2024 2:00 PM UTC

·     Unlike South Africa and Russia, Turkiye continued with tightening monetary policy in Q1 due to stubborn inflation, pressure on FX and reserves. Meanwhile, Russia and South Africa halted their tightening cycles as of 2024 and will likely start cutting interest rates in Q3 depending on how