Weekly Economic Index: African Central Banks Hike Interest Rates

Like their counterparts in advanced economies, monetary policymakers in Sub-Saharan Africa have become more aggressive on interest rates.

On Tuesday, September 27, 2022, the Central Bank of Nigeria (CBN) raised the country’s benchmark interest rate to a 20-year high of 15.5% from a previous 17-year high of 14 percent. This increase was more than expected and made it one of four African central banks to have increased by 300 basis points or more this year.

The CBN announcement came days after the South African Reserve Bank raised its redemption rate by 75 basis points to 6.25% – its sixth consecutive increase.

However, an opposite scenario is playing out in Angola. The central bank lower interest rates last week as inflation continued to decline thanks to the currency’s oil-linked rally.

Market overview

Below is Ventures Africa’s weekly economic summary for the week ending September 30, 2022.

Stock markets

Here’s how stocks fared in major African markets (Nigeria, Egypt, South Africa and Kenya) at the end of the week:

An employee of the Nairobi Stock Exchange

The Nigerian Stock Market ended the week flat, with the NGX All-Share Index falling 0.01% to close at 49,024.16.

Top 5 winners

Multiverse Mining and Exploration Plc – +30.85%

Nigerian Exchange Group – +17.65

Jaiz Bank Plc – +15.38

Cadbury Nigeria Plc – +14.77

Eterna Plc. – +9.91

Top 5 refusals

Neimeth International Pharmaceuticals Plc – -10.26

Nestle Nigeria Plc – -10.00

Africa Prudential Plc – -9.91

Royal Exchange Plc – -9.80

Fidson Healthcare Plc – -9.05

The Egyptian Stock Exchange was slightly bearish as the EGX 30 fell 0.68% to close the week at 9827.46 points.

Top 5 winners

Development and reconstruction of Egyptian housing – + 18.75%

Arabic ceramics (Aracemco) – +9.66%

Atlas for Land Reclamation and Agricultural Transformation – +8.00%

Citadel Capital – +7.38%

Delta Sugar – 5.56%

Top 5 refusals

The Arab Dairy Products Co. Arab Dairy – -7.41%

Lecico Egypt 10.41 – -6.89%

Northern Upper Egypt agricultural development and production – -4.25%

Alexandria Flour Mills – -3.49%

International agricultural products – -2.92%

The South African stock market traded flat during the week, with the JSE All-Share Index gaining 0.1% to close at 63,726.37 points.

Top 5 winners

Brimstone Investment Corp Ltd – +20.52%

Kibo Energy Plc – +20.00%

Jasco Electronics Holdings Ltd – +17.39%

Brimstone Inv Corp Ltd-N – +15.53%

4Sight Holdings Ltd – +9.52%

Top 5 refusals

Ellies Holdings Ltd – -16.67%

Nampak Ltd – -13.15%

Schroder Eur REIT Plc – -13.14%

Stefanutti Stocks Holdings Ltd – -11.11%

Wesizwe Platinum Ltd – -8.57%

The Kenya Stock Market had a bearish week, with the NSE All-Share Index falling 4.14% to close at 128.41 points.

Top 5 winners

Flame Tree Group – +10,327.35%

Nairobi Stock Exchange – +5.13%

Centum Investment – ​​+2.83%

Home Africa – +2.78%

Cooperative Bank of Kenya – +1.72%

Foreign exchange markets

Here is how the currencies of Nigeria, Egypt, Kenya and South Africa have performed against the US dollar in official markets.

  • The Nigerian Naira opened the week at N436.33/$1 and closed at N437.03/$.
  • The Egyptian pound opened the week at E£19.5/$ and closed at E£19.6/$.
  • The Kenyan shilling started the week at 120.70 Ksh/$ and closed at 120.83 Ksh/$
  • The South African rand appreciated against the US dollar as it opened the week at 18.06 rand/$ and closed at 17.89 rand/$.

Oil prices

  • The price of the OPEC basket of thirteen crudes stood at $92.76 a barrel on Thursday, up slightly from $92.67 a barrel the previous week.
  • Brent opened the week at $82.86/barrel and gained 6.1% to close at $87.95/barrel.
  • West Texas Intermediate opened the week at $76.71/barrel and climbed 7% to $82.13/barrel.

Crypto Markets

The cryptocurrency market ended the week flat, losing only 0.3% over a 7-day period to reach a market capitalization of $920.11 billion. Here is how the top three cryptocurrencies have fared over the past seven days:

  • Bitcoin (BTC) gained 1.25% to trade at $19,038.
  • Ether (ETH) fell 1.58% to trade at $1,273.
  • Binance Coin (BNB) gained 3.59% to trade at $284.

Technology funding


Commenting on the upward trend in interest rates in Africa, Virág Fórizs, Emerging Markets Economist at Capital Economics, believes that we have not seen the end of it, thanks to inflation. “Taking inflation under control is clearly the top priority, but we suspect MPC members also had their eye on strengthening currencies, which have come under renewed pressure. currency and growing balance of payments tensions are likely to trigger significant interest rate hikes in upcoming meetings elsewhere as well, notably in Ghana and Kenya.

Comments are closed.