12 Apr

Nigeria Rate-Cut Hope Lives as Inflation Slows to Two-Year Low

Nigerian inflation slowed for a 14th straight month in March, taking consumer-price growth below the benchmark interest rate for the first time in two years and opening the door for a rate cut.

Consumer inflation in Africa’s most-populous nation decelerated to 13.3 percent from a year earlier, the lowest rate in two years and below the benchmark rate of 14 percent.

 Nigeria’s central bank left its main lending rate at a record high of 14 percent when policy makers met April 4 to continue fighting inflation that’s been above the target range of 6 percent to 9 percent for more than 2 1/2 years. Governor Godwin Emefiele said the bank would consider cutting rates from where they have been since July 2016 when inflation slows closer to single digits.
“Absolutely, they now have more scope to cut rates because of the pronounced drop in inflation,” Razia Khan, head of macroeconomic research at Standard Chartered Bank Plc, said by phone from London.
The median estimate in a Bloomberg survey was for annual price growth to slow to 13.6 percent. Inflation slowed from 14.3 percent in February, the Abuja-based National Bureau of Statistics said in a statement.
Food-price inflation decelerated to 16.1 percent in March the weakest rate of growth since July 2016, it said.
The cost of gasoline climbed to an average 9.4 percent in March to 163.4 naira ($0.46) a liter (0.3 gallon) from a year earlier, said the bureau, whose data includes unofficial pump prices. Nigeria currently caps gasoline retail prices at 145 naira per liter.

Food-price inflation decelerated to 16.1 percent in March the weakest rate of growth since July 2016, it said.

The cost of gasoline climbed to an average 9.4 percent in March to 163.4 naira ($0.46) a liter (0.3 gallon) from a year earlier, said the bureau, whose data includes unofficial pump prices. Nigeria currently caps gasoline retail prices at 145 naira per liter.

To read the full article, click here. 

14 Dec

‘Make-or-Break’ Time for South Africa as ANC Chooses New Leaders

Almost a quarter-century after Nelson Mandela led the African National Congress to power at the end of apartheid and the world heralded the birth of the “rainbow nation,” South Africa stands at a crossroads.

As delegates of the ruling African National Congress meet this weekend to choose a successor to President Jacob Zuma as party leader, they face a clear choice: his ex-wife, Nkosazana Dlamini-Zuma, who favors the president’s push for “radical economic transformation” to redistribute wealth to the black majority, or his deputy, Cyril Ramaphosa, who’s pledging to fight corruption and revive a moribund economy to cut a 28 percent unemployment rate.

The leadership conference comes as Zuma’s immersion in a succession of scandals is eroding the 105-year-old party’s support to such an extent that it’s now at risk of losing its majority in 2019 elections. The run-up to the vote by 5,240 delegates that’s scheduled for Dec. 17 and is too close to call has caused deep rifts in the ANC, weighed on the rand and nation’s bonds and unnerved investors seeking political and policy clarity.

“What’s really at stake now is the future of South Africa, not just the ANC’s continued governance of South Africa — everyone needs to understand that,’’ David Makhura, the 49-year-old premier of the nation’s richest province, Gauteng, where an overwhelming majority of ANC branches back Ramaphosa, said in an interview Tuesday. “Even people who don’t vote for the ANC are hoping that we will make one move that will bring South Africa back on track.”

Support for the party slipped to an all-time low of 54 percent in last year’s municipal elections, from a peak of almost 70 percent in 2004, and it lost control of Johannesburg, the economic hub, and Pretoria, the capital, to opposition coalitions.

Fifty-nine percent of 2,100 people who said they’d voted for the ANC favor Ramaphosa to take over as leader, while 19 percent backed Dlamini-Zuma, a computer-generated poll published this month by survey company RatePop found. The party will probably struggle to retain power in 2019 with her at the helm, according to the survey.

To read the full article, click here.