<ul>
<li>S&amp;P Global Ratings (S&amp;P) affirms South Africa’s long term foreign and local currency debt ratings, negative outlook is unchanged</li>
</ul>
Government welcomes S&amp;P’s decision of maintaining South Africa’s long term local currency debt ratings of ‘BBB-‘; an investment grade rating. The affirmation of the long-term foreign currency rating of ‘BB+’ and the negative outlook on the ratings are also noted. 
While government agrees with S&amp;P that the pace of economic growth is slow and as such poses risks to fiscal consolidation and rising contingent liabilities, the fiscal policy stance continues to be guided by chapter 13 of the Constitution. It states that while there is promotion of efforts aimed at economic development, good governance, social progress and rising standard of living for all South Africans, there must also be transparency, accountability and sound financial controls in the management of public finances. 
Key focus is to safeguard confidence and reclaim the investment grade ratings. Intensive engagements with broader stakeholders will continue. Sustainable fiscal policy and efforts to tackle sources of low growth are critical. Improvement in policy design, finalisation of key policies and coordination remain critical for boosting confidence and economic growth. Government is currently re-engaging with the private sector to make sure that the joint work of government, business, labour and the civil society continues and that the pledges made thus far are fulfilled. 
The work to improve governance and financial challenges in the state owned companies (SOCs) is also on track. In November 2016, Cabinet: 
 Endorsed a private-sector participation framework to guide collaboration between SOCs and the private sector on infrastructure projects; 
 Adopted a guideline for the remuneration and incentive standards for directors of SOCs; 
 Approved the broad thrust of a guide for the appointment of boards and executive officers; 
 Recommended further consultation on the first draft of a new government 
shareholder policy, which will culminate in overarching legislation for SOCs; 
and 
 Noted the proposal to determine and cost the developmental mandates of 
SOCs. 
Government is committed to work with its social partners in improving business 
and consumer confidence. The National Development Plan continues to be the 
anchor policy of government providing greater policy certainty. The Constitution 
remains explicit in realising the fundamental rights of all who live in South Africa 
and that the public funds are spent for a common good.

S&P Affirms SA’s foreign & domestic debt, Outlook remains negative

Oludare Mayowa | LAGOS
Nigeria&#8217;s central bank said on Tuesday it will sell $100 million at a special wholesale spot and forwards auction to improve dollar liquidity in the foreign exchange market and curb pressure on the local currency.
The bank, in a notice to commercial lenders, said the dollar auction would be both for spot and forward settlements and would be settled within the next 60 days.
Africa&#8217;s biggest economy shrank by 1.5 percent in 2016 in its first annual recession in 25 years, hit by a shortage of hard currency and lower revenue from its dominant oil sector as world crude prices remained under pressure.
The central bank has been intervening on the official market to try to narrow the spread between the official interbank and black markets. It has sold around $4 billion since February, but analysts doubt that this pace can be sustained.
Nigeria&#8217;s foreign exchange reserves had dropped 0.87 percent to $30.49 billion by May 25 from a month ago.
The local currency was quoted at 380.33 per dollar at the investor window on Tuesday, according to the market regulator FMDQ OTC Securities Exchange.
It was quoted at 382 a dollar on the black market, while commercial lenders quoted the local currency at 305.85 per dollar on the interbank market.
(Reporting by Oludare Mayowa, editing by David Evans)
&nbsp;

Nigeria’s central bank to sell $100 mln at forward, spot forex auction

Mfuneko Toyana | JOHANNESBURG
South Africa&#8217;s rand extended gains to near a two-month high on Thursday as the dollar stumbled after minutes of a policy meeting of the U.S. central bank showed members agreed on delaying rate hikes.
At 0640 GMT, the rand had firmed 0.35 percent to 12.8800 per dollar, its firmest since March 30, compared to a close of 12.9250 in New York on Wednesday.
The rand touched a session high of 12.8700 overnight following better-than-anticipated moderation of consumer prices on Wednesday, with April price growth dipping below the top of the Reserve Bank&#8217;s 3-6 percent target for the first in nine months.
The currency then extended gains following the release of minutes from latest Federal Reserve meeting, showing policymakers agreeing to hold off on rate increases until they see evidence that a recent economic slowdown was transitory.
South Africa&#8217;s central bank is due to announce its latest interest rate decision later on Thursday. The bank kept rates on hold the whole of 2016, but has said it had reached the end of tightening cycle that begun in 2014.
Stocks were set to open higher at 0700 GMT, with the JSE securities exchange&#8217;s Top-40 futures index up 0.3 percent.
In fixed income, the yield for the benchmark government bond due in 2026 fell 1.5 basis points to 8.485 percent.
(Reporting by Mfuneko Toyana; Editing by Ed Cropley)
&nbsp;

S.Africa’s rand races to 2-month high after CPI dips, dovish Fed minutes

Mfuneko Toyan | JOHANNESBURG
South Africa&#8217;s central bank governor Lesetja Kganyago said on Tuesday that raising lending rates would do little to attract new investments to the country after its credit rating was downgraded to junk.
Kganyago, due to announce his first rates decision since S&amp;P Global Ratings and Fitch cut South Africa&#8217;s credit score to sub-investment grade in April, told online publication The Conversation that the Reserve Bank (SARB) would stick to targeting inflation of 3 to 6 percent.
<blockquote>&#8220;Raising the repo rate by itself would do little to attract new investments,&#8221; Kganyago was quoted as saying.
&#8220;But failure to deal with the inflationary consequences of currency depreciation, which pushes up import prices and potentially all prices, would also push up both short and long term borrowing costs,&#8221; Kganyago said.</blockquote>
The currency plunged more than 12 percent in the wake of President Jacob Zuma&#8217;s decision in late March to recall Pravin Gordhan from meetings with investors overseas and then fire him as finance minister a week later.
Price growth in March slowed to 6.1 percent. Statistics South Africa publishes April CPI on May 24, with a Reuters poll forecasting inflation at 5.6 percent.
In March the bank kept rates unchanged for an eighth straight meeting, saying it had reached the end of its tightening cycle, which has seen it raise rates a total of 200 basis points (bps) since 2014.
But following the cabinet reshuffle and downgrades Kganyago said pressure on the rand, and accelerated inflation as inventors sold off local assets, could force the regulator to put off cutting rates.
The bank&#8217;s policy committee meets for three days starting next Monday and is due to announce its rates decision on Thursday.
Forward markets rates on Tuesday were pricing in a zero percent chance of a hike next week and a 9 percent probability of a 25 basis point cut. For meetings in July and September, markets see a 21 percent and 50 percent probability of a 25 bps hike.
Michelle Wohlberg, fixed income specialist at Rand Merchant Bank, said a rate move in either direction would be &#8220;pulling the trigger too quickly&#8221;, with the bank likely to consider cutting once South Africa&#8217;s credit rating path was clear.
&#8220;They&#8217;re waiting for things to settle down and for Moody&#8217;s to come out with their rating report. And once CPI prints in-line they&#8217;ll start thinking about cutting,&#8221; Wohlberg said.
Moody&#8217;s, which put the country on review for a downgrade after the cabinet reshuffle, is due to meet local investors and policy makers this month.
(Reporting by Mfuneko Toyana; Editing by Mark Trevelyan)
&nbsp;

S.Africa’s central bank governor says raising rates won’t lure investment

Nelson Banya | HARARE
Zimbabwe&#8217;s tax agency said on Thursday it had collected $862 million in the first quarter of 2017, exceeding its target by 6 percent, helped by automated operations and improved compliance among businesses.
The southern African country, which fell short of its 2016 revenue goal by 4 percent as its economy suffered from weaker commodity prices and a liquidity crisis, expects to collect $3.7 billion this year.
President Robert Mugabe&#8217;s government, which fell out with western donors nearly two decades ago amid accusations of human rights abuses and electoral fraud, does not receive significant direct international aid and relies almost entirely on tax revenues to fund its budget.
Zimbabwe&#8217;s economy stagnated last year following a devastating drought while its budget deficit exploded as Mugabe&#8217;s administration struggled to pay its workers, which helped fan anti-government protests.
Zimbabwe Revenue Authority (ZIMRA) chairperson Willian Bonyongwe said gross revenue collections for the first quarter of 2017 were 10 percent higher than figures for the same period last year.
<blockquote>&#8220;This upward trend is a result of a battery of revenue enhancement measures &#8230; which include automation, greater enforcement and the fight against corruption,&#8221; Bonyongwe said in a quarterly statement.</blockquote>
Value-added tax on local sales, at 22.42 percent, weighed in with the biggest contribution towards the revenue, followed by individual tax at 20.05 percent, ZIMRA said.
Company tax made up 11.2 percent, while mineral royalties, at $16.39 million, exceeded the quarterly target by 21.42 percent on the back of improved output and commodity prices.
The tax agency says it expects better revenue flows this year, following an improved farming season, but has cautioned that an extended bank note shortage Zimbabwe has experienced since the beginning of 2016 will affect economic performance.
Zimbabwe&#8217;s government has revised upwards its 1.7 percent economic growth projection for 2017 to 3.7 percent, citing the rebound in agriculture.
(Reporting by Nelson Banya; Editing by Gareth Jones)

Zimbabwe tax agency beats first quarter revenue target

Chijioke Ohuocha | ABUJA
Nigeria plans to get out of recession by boosting government revenues and cracking down on corruption, Finance Minister Kemi Adeosun said on Thursday, and will also issue more international debt to pay for infrasturcture projects.
The country is in its second year of recession, brought on by lower oil prices, which have slashed government revenues, weakened the currency and caused dollar shortages frustrating business and households.
World Bank chief economist for Africa, Albert Zeufack, on Wednesday said fiscal adjustments in Nigeria would be &#8220;extremely challenging&#8221; and that the country needs to reform its finances to ensure it can hedge against any future currency crisis.
Nigeria also ranks well into the bottom third of Transparency International&#8217;s global corruption index. On Wednesday, for example, more than $43 million found in an apartment complex in Lagos was said to be related to an investigation into the handling of humanitarian aid.
Adeosun said her aim was to get the non-oil sector of Nigeria&#8217;s economy which accounts for around 90 percent of GDP to contribute to government revenues.
&#8220;Improving non-oil revenues is something we are working hard on. We are rolling out measures to get more people into the tax net,&#8221; Adeosun told CNBC Television.
&#8220;We are get out of recession because we are following the right type of policies. We are improving our revenues, we are improving our efficiencies in how we spend money.
http://cnbc.africa/news/western-africa/2016/11/21/nigerias-recession-deepens/
&#8220;We are investing in the infrastructure that is needed, power, rail, road, the big enablers of growing sustainable economies.&#8221;
Adeosun said liquidity on currency markets has been improving as the central bank has boosted dollar supply, thanks to recently rising oil prices. She added that government was harmonising fiscal, monetary and trade policies to get the economy growing again.
However, the central bank, worried about the currency effects on inflation, has so far resisted calls to lower interest rates for 14 percent to enable the government borrow cheaply to spend its way out of recession.
Adeosun said Nigeria plans to issue long-term debt on the international markets more regularly for infrastructure projects, taking advantage of the country&#8217;s debt to GDP ratio of 13 percent. But the interest burden is rising due to low revenues.

Nigerian finance minister says country needs to tap its non-oil revenues

Chijioke Ohuocha | ABUJA
Nigeria needs to reform its finance to ensure it can hedge against any future currency crisis, the World Bank chief economist for Africa said on Wednesday.
Albert Zeufack said currency adjustments could lead to higher inflation but continued monetary policy tightening would price pressures, adding that making fiscal adjustments in the West African country now in its second year of recession would be &#8220;extremely challenging&#8221;.
Africa&#8217;s biggest economy is facing a currency crisis brought on by low oil prices, which has hammered its foreign reserves and created chronic dollar shortages, frustrating businesses and individuals.
(Reporting by Chijioke Ohuocha; editing by John Stonestreet)

Nigeria needs reforms to hedge against future FX crisis – World Bank Africa economist

This article was first published last year as South Africa faced a possible downgrade by rating agencies
Current developments in South Africa are reminiscent of events in 1985. In that year South Africa experienced high costs from currency depreciation and adverse political developments. At the time the country faced increasing international sanctions and isolation, while the exchange rate of the rand remained under severe pressure, recording sharp falls in the international value of the rand.
South Africa’s financial stability was put under severe pressure after the infamous <a href="https://www.nelsonmandela.org/omalley/index.php/site/q/03lv01538/04lv01600/05lv01638/06lv01639.htm">Rubicon speech</a> of then State President P W Botha. Before the speech, high expectations were raised internationally about the announcement of major political changes in South Africa, but these expectations did not materialise. Following the speech, foreign banks refused to roll over South African short-term foreign debt, causing further depreciation of the exchange rate of the rand.
In 2016 South Africa might see a slow motion repeat of the events of 1985, culminating in a debt standstill. The following events, reminiscent of developments then, could unfold:
<ul>
<li>a continued depreciation of the rand, accelerated by the President’s inexplicable decision to <a href="http://mg.co.za/article/2015-12-09-nhlanhla-nene-removed-as-finance-minister">remove</a> his Finance Minister. The depreciation substantially increases the capital value of and interest repayments on foreign debt; and</li>
<li>a downgrading of South Africa’s credit rating to junk status that results in credit lines being withdrawn by foreign funders such as banks.</li>
</ul>
This time we can see trouble ahead and the government should act responsibly to avert a slow motion replay of 1985.
<h2>Debt standstill</h2>
Currency depreciation brings certain benefits to a country. The most obvious is the fact that exports become cheaper abroad and that demand for exports are therefore stimulated.
Unfortunately currency depreciation does not only bring benefits. Imported goods and services also become more expensive. More expensive imports put pressure on domestic inflation that can result in increases in interest rates. In economics it has often been said:
<blockquote>There is no free lunch, everything has a cost, even if then only an opportunity cost.</blockquote>
Currency depreciation also increases the capital value of foreign debt in domestic currency (where foreign debt are designated in foreign curreny) and the interest burden on such debt, as interest is also paid in foreign currency.
In short: in 1985 an unwillingness of banks abroad to make loans to South African entities (albeit for political reasons) plus the depreciation of the currency resulted in the inability of the country to repay its foreign debt.
The financial crisis culminated in the “Debt Standstill”, a moratorium on the repayment of most of South Africa’s private sector foreign debt, but excluded government debt. Debt repayments were managed by a Debt Standstill Committee and rescheduled over an extended time period, with the last of the rescheduled debt repaid in 2001.
<h2>The falling rand</h2>
In recent months the exchange rate of the rand has shown considerable depreciation. This is actually an acceleration of a long-term declining trend. The nominal effective exchange rate of the rand has lost around 50% of its value <a href="https://www.resbank.co.za/Research/Rates/Pages/SelectedHistoricalExchangeAndInterestRates.aspx">since 2010</a>.
The South African Reserve Bank <a href="https://www.resbank.co.za/Research/Rates/Pages/SelectedHistoricalExchangeAndInterestRates.aspx">describes</a> the nominal effective exchange rate as
<blockquote>… a weighted exchange rate of the rand measured against a basket of the currencies of South Africa’s twenty most important trading partners. The calculation is based on trade in and consumption of manufactured goods.</blockquote>
On this basis, measured against 20 currencies, the rand has therefore lost about half of its value.
In assessing the “Debt Standstill” with the benefit of hindsight, it is important to distinguish between South Africa’s foreign debt and South African government debt, as only private sector foreign debt was caught in the standstill.
The country’s foreign debt is all funds borrowed abroad by South Africans, including companies, other entities and private individuals and includes the government’s foreign borrowing. By the middle of 2015 South Africa’s foreign debt amounted to some R1.7 trillion, of which 46% was denominated in <a href="https://www.resbank.co.za/Lists/News%20and%20Publications/Attachments/6999/10Statistical%20tables%20%E2%80%93%20International%20economic%20relations.pdf">foreign currency</a>.
South African government debt is the total of all funds borrowed by the government to balance its budget. South African government debt at present amounts to some <a href="http://www.treasury.gov.za/documents/mtbps/2015/mtbps/Technical%20annexure.pdf">R1.8 trillion</a>. Of this, some R190 billion (10%) is foreign debt, while the balance is borrowed from pension funds, banks and the like in South Africa.
South Africa’s foreign debt naturally includes the portion of the South African government <a href="http://www.treasury.gov.za/documents/mtbps/2015/mtbps/Technical%20annexure.pdf">debt borrowed abroad</a>, comprising about 11% of the country’s foreign debt. The balance is supplier credit, trade credit and the like. For instance: if a foreign supplier sells to a South African company and provides a six month credit line, the credit line is part of the country’s foreign debt for a period of six month.
This credit line has nothing to do with the South African government’s debt position, domestic or foreign. Government debt and the country’s foreign debt should not be confused.
Since 2007 South African foreign debt has shown a steady increase as percentage of both the gross domestic product (GDP) and total export earnings (TEE). At the same time interest payments on foreign debt as percentage of TEE have <a href="https://www.resbank.co.za/Lists/News%20and%20Publications/Attachments/6999/10Statistical%20tables%20%E2%80%93%20International%20economic%20relations.pdf">increased</a>.
<h2>Possible junk status</h2>
South Africa’s foreign debt position (which should not be confused with the debt of the South African government) is vulnerable in three respects. First, currency depreciation raises the capital value of the funds borrowed abroad in foreign currency, hence increasing the repayment burden on South African borrowers. Foreign debt as percentage of GDP increases owing to currency depreciation.
Secondly, interest payments on foreign debt increase owing to currency depreciation. This will be exacerbated by an international normalisation of interest rates. The result might be a raising TEE if the combined result of higher international rates and currency depreciation exceeds the increase in exports owing to currency depreciation.
These two factors were present in 1985, but were exacerbated at that time by political considerations, namely banks refusing to lend more money to South Africa after the Rubicon speech. The last element for a repeat of 1985 in slow motion might be triggered by another event some 30 years later: a credit risk downgrading to junk status of South Africa by international rating agencies.
If South Africa’s international risk rating is downgraded to junk status, international banks and other companies will be much more reluctant to make loans to South African entities, or will even withdraw existing credit lines.
This might be the seismic event similar to the withdrawal of international credit lines for political reasons in 1985, culminating in a debt standstill. The South African government should introduce in a timely fashion policies to avert a repetition on the events of 1985.

South Africa is on a cliff edge – just as it was in 1985

Tanzania&#8217;s energy regulator raised maximum retail prices of petrol and diesel on Monday, citing higher international costs for both crude and refined products and a weaker local currency, a move expected to exert upward pressure on inflation.
Fuel prices have a big effect on the east African country&#8217;s inflation rate, which rose to 5.5 percent year-on-year in February from 5.2 percent the previous month.    The Energy and Water Utilities Regulatory Authority (EWURA) raised the retail price for petrol by 5.18 percent and the price of diesel by 2.76 percent.    EWURA said the hike in retail prices were caused by &#8220;increases of world oil market prices, increases of bulk procurement system premiums and the continued depreciation of the Tanzanian shilling.&#8221;
The regulator hiked the price of petrol in the commercial capital Dar es Salaam by 102 shillings a litre to 2,060 shillings while the price of diesel was up by 51 shillings to 1,913 shillings.    Kerosene prices remained unchanged at 1,852 shillings per litre.
(Reporting by Fumbuka Ng&#8217;wanakilala; Editing by Elias Biryabarema)

Tanzania hikes fuel prices on weaker currency

Africa&#8217;s biggest mobile phone operator MTN Group swung into a hefty $108 million annual loss on Thursday, its first in two decades, hit by a regulatory fine in Nigeria and unfavourable currency moves.
MTN said its headline loss came in at 1.4 billion rand ($108 million), or 77 cents per share, in the year to end-December compared with headline earnings of 13.6 billion rand, or 746 cents per share, a year earlier.
MTN agreed to pay a fine of 330 billion naira ($1.1 billion), reduced from $5.2 billion, in June last year after a prolonged legal battle to end a dispute in Nigeria over missing a deadline to cut off unregistered SIM cards.
The company said the fine wiped 10.5 billion rand ($768 million) &#8212; 500 cents per share &#8212; from headline earnings, South Africa&#8217;s main measure of profit.
Africa&#8217;s most populous nation and biggest economy, Nigeria, is MTN&#8217;s most lucrative but increasingly problematic market.
MTN is under investigation by Nigerian lawmakers for allegedly illegally repatriating $14 billion between 2006 and 2016, the second major dispute analysts have said exposes the inherent risk of investing in frontier markets.
MTN has denied any wrongdoing.
Founded with Pretoria&#8217;s help after the end of white rule in 1994, MTN is seen as one of post-apartheid South Africa&#8217;s biggest commercial successes but clashes with regulators in recent years have exposed governance issues and hobbled growth.
($1 = 13.0003 rand)
 
(Reporting by Tiisetso Motsoeneng; Editing by Ed Stoddard)﻿

South Africa's MTN swings into first annual loss in 20 years

Nigeria&#8217;s central bank took a step nearer to outright devaluation of the naira currency on Tuesday, providing 23 commercial banks with a combined $370.8 million at forward exchange rates up to 15 percent weaker than the official rate.
On Monday, the central bank effectively devalued the local currency for private individuals, who account for about 20 percent of total foreign exchange demand in the country.
On Tuesday, it said it sold dollars using one- and two-month forward exchange rates to commercial banks whose bids ranged from 315 naira to 360 naira per dollar, up to 15 percent weaker than the official rate of 305 naira that commercial importers typically use.
Forward exchange rates are rates at which banks agree to exchange one currency for another at a future date.
Selling the dollars at new one- and two-month forward rates may set expectations for the central bank to allow the naira to trade at a weaker level in the future, after the government had kept it at an artificially strong value according to critics.
Banks bought $216.5 million in one-month forwards, and $154.3 million in two-month forwards, said the central bank.
Nigeria&#8217;s dollar supply has been throttled by foreign currency restraints and low exports of crude oil. The government devalued the naira last June but still kept it at just over 300 to the dollar &#8211; as much as 40 percent stronger than black market rates in the following months.
Despite calls from businesses and economists, the government had refused to take steps to devalue the naira further until now, while President Muhammadu Buhari, a staunch opponent of devaluation, has been on medical leave in Britain for over a month.
On Monday, Nigeria weakened the naira rate for private individuals days after a top advisory body demanded an urgent review at a meeting chaired by Vice President Yemi Osinbajo, who is currently acting president.
It was Osinbajo who unveiled the idea of a more flexible exchange rate last year, also while Buhari was on medical leave, leading to a 30 percent devaluation weeks later.
In Tuesday&#8217;s statement, the central bank said it had offered $500 million to banks, &#8220;but not all of them provided enough naira backing to pay fully for their respective bid amounts&#8221;.
The central bank said it was &#8220;more than ever ready to support the inter-bank market by ensuring liquidity and transparency to guarantee efficiency in the Forex market.&#8221;
 
(Reporting by Camillus Eboh; Additional reporting by Chijioke Ohuocha and Ulf Laessing in Lagos; Writing by Paul Carsten; Editing by Hugh Lawson)﻿

Nigeria steps nearer to devaluation with central bank dollar sale

Shares in South Africa&#8217;s banking index extended losses on Monday as investors continued to digest the competition watchdog&#8217;s recommendation that banks should be fined for rigging the rand currency.
South Africa&#8217;s Competition Commission said last week it had found that more than a dozen local and foreign banks including Barclays Africa (Absa) and Standard Bank colluded to coordinate trading in the South African and U.S. currencies.
The Johannesburg Stock Exchange&#8217;s banking index extended losses to 1.54 percent to 7,473 points by 1200 GMT, its lowest level since Feb. 10, before the forex rigging announcement.
&#8220;There is more and more concern about what has happened with these banks colluding on this rand trading that took place,&#8221; said Cratos Capital equities trader Greg Davies. &#8220;It might be investors deciding to sell their shares in case there are very big fines from the authorities.&#8221;
In the case of the alleged rigging of the rand, the antitrust watchdog said it had recommended fines amounting to 10 percent of the banks&#8217; South African annual revenues to the country&#8217;s Competition Tribunal, which adjudicates on the commission&#8217;s findings.
Details of Finance Minister Pravin Gordhan&#8217;s budget speech on Wednesday will also be the next likely trigger for price moves, trader at Global Trader Paul Chakaduka said.
&#8220;Leading up to the budget we should see pressure on the financials without a doubt,&#8221; Chakaduka said.
 
(Reporting by Nqobile Dludla; Editing by Ed Stoddard)﻿
<div></div>

S.African banking shares extend losses after watchdog charges

South African banks accused of rigging rand currency dealing should be punished if a report by the competition watchdog is true, the National Treasury said on Thursday.
&#8220;We view this matter in a very serious light and welcome any steps taken against wrong-doing by any financial institutions,&#8221; the treasury said in a statement.
The Competition Commission said on Wednesday it had found the banks, including U.S., European, Japanese and Australian lenders, had colluded to coordinate their trading activities when dealing in the South African and U.S. currencies.
 
(Reporting by Mfuneko Toyana)﻿

S.Africa Treasury says banks should be punished if currency rigging is true

Nigeria&#8217;s central bank has disbursed $2.83 billion to critical sectors of the economy in December and January, it said in a statement on Thursday, in an attempt to kickstart a struggling economy and alleviate a drought of foreign currency.
Nigeria&#8217;s economy is wallowing in its first recession in a quarter of a century, hamstrung in part by low exports of the crude oil on which the government depends for revenues and bringing in foreign currency.
That lack of dollars in particular has left businesses struggling to import overseas products they need. The situation has been exacerbated by a government-imposed exchange rate that critics say artificially keeps the naira around 40 percent stronger than it should be.
The Central Bank of Nigeria (CBN) said it favoured the manufacturing, raw material and agriculture sectors when disbursing the dollars in December and January, hoping to create employment and spur wealth creation.
The raw materials sector received $609 million in December and $228 million in January. Manufacturing got $53 million in December and $71 million in January, the CBN statement said.
The central bank is determined to continue to ease the foreign exchange pressure on critical sectors, the statement cited Isaac Okorafor, acting director of the communications department, as saying.
Nigeria&#8217;s dollar reserves have risen 8.39 percent since the beginning of the year, mirroring a rise in global oil prices, but remain far from a peak of $64 billion in August 2008.
Nigeria&#8217;s naira hit a new low on the black market on Wednesday. That spurred the head of the bureau de change association to urge members to help stabilise the currency, the continued weakness of which has become a &#8220;major concern&#8221; for the central bank.
 
(Reporting by Camillus Eboh and Chijioke Ohuocha; Writing by Paul Carsten)﻿
<div></div>

Nigeria's central bank disburses $2.83 bn to boost economic recovery

Angola will achieve its inflation and exchange rate targets in 2017, the southern African nation&#8217;s central bank governor said on state radio on Wednesday.
&#8220;&#8230; the indicators show that we are going to have a better time next year, that we will have a better stability and we will be able to achieve the objectives of the inflation rate, the exchange rate &#8230;,&#8221; Valter da Silva said on Radio National de Angola.﻿

Central bank governor says Angola to achieve inflation targets in 2017

Zimbabwe expects its 2016 fiscal budget deficit to widen to $1.18 billion, nearly eight times more than it forecast a year ago, Finance Minister Patrick Chinamasa said in a budget speech on Thursday.
Chinamasa had pencilled in a deficit of $150 million in November 2016, equivalent to 1.1 percent of GDP, and said it would be financed via domestic borrowing.﻿
Zimbabwe halves 2016 growth forecast, budget deficit widens﻿﻿
Zimbabwe&#8217;s economy will grow by 0.6 percent in 2016, half the previous forecast, but will recover next year, Finance Minister Patrick Chinamasa said in a budget speech on Thursday.
Chinamasa said the budget deficit for the 2017 fiscal year was estimated at $400 million, equivalent to 3 percent of GDP, up from 1.1 percent in this year.
The southern African nation is grappling with a devastating drought that has left more than 4 million people facing hunger, while the worst financial crisis in seven years has fuelled some of the biggest anti-government protests in a decade.﻿

Zimbabwe sees 2016 budget deficit nearly 800 pct higher than forecast

Business activity in Egypt shrank in November, with the deterioration picking up pace for the fourth consecutive month, as weakness in the pound currency raised costs and hit output, a survey showed on Monday.
The Emirates NBD Egypt Purchasing Managers&#8217; Index (PMI) for Egypt&#8217;s non-oil private sector dropped to a 40-month low of 41.8 in November, edging down from 42 in October and far below the 50 mark that separates growth from contraction. Egypt&#8217;s central bank abandoned its peg of 8.8 pounds to the U.S. dollar on Nov. 3, in a move aimed at attracting capital inflows and ending a black market for dollars that had all but crippled the banking system.
The move was largely welcomed by businesses, which had struggled to obtain dollars amid strict capital controls, and helped Egypt clinch a $12 billion loan from the IMF. But the currency has since depreciated to 17.8 against the dollar.
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&#8220;The ongoing downtrend evident in November’s survey highlights that there will be no quick fixes to Egypt’s economic difficulties, even following the EGP devaluation earlier in the month,&#8221; said Jean-Paul Pigat, senior economist at Emirates NBD.
&#8220;In this environment, it is crucial that authorities remain committed to their IMF-supported reform program in order to anchor investor confidence.&#8221;
Following the float, Egypt received the first $﻿2.75 billion tranche of its three-year loan from the International Monetary Fund, to help plug its financing gap and stabilise the currency.
The PMI showed purchasing prices continued to rise in November to their highest levels since data collection started, as the currency depreciated against the dollar and the government raised fuel prices.
Output fell substantially in November to 36.8. The pace was marginally slower than October&#8217;s decline but remained one of the most marked since data collection began in April 2011, with companies citing poor economic conditions, high prices and shortages of some raw materials.
The index showed new orders dropping to 36.3 &#8211; the fastest fall in 39 months &#8211; largely due to soaring inflation linked to the weakness of the Egyptian pound against the dollar. As companies sought to curb rising costs, rate of employment fell for the 18th consecutive month in November to 45.1 compared with 46.2 in October, data from the survey showed.﻿

currency

S&P Affirms SA’s foreign & domestic debt, Outlook remains negative

Nigeria’s central bank to sell $100 mln at forward, spot forex auction

S.Africa’s rand races to 2-month high after CPI dips, dovish Fed minutes

S.Africa’s central bank governor says raising rates won’t lure investment

Zimbabwe tax agency beats first quarter revenue target

Nigerian finance minister says country needs to tap its non-oil revenues

Nigeria needs reforms to hedge against future FX crisis – World Bank Africa economist

South Africa is on a cliff edge – just as it was in 1985

Tanzania hikes fuel prices on weaker currency

South Africa's MTN swings into first annual loss in 20 years

Nigeria steps nearer to devaluation with central bank dollar sale

S.African banking shares extend losses after watchdog charges

S.Africa Treasury says banks should be punished if currency rigging is true

Nigeria's central bank disburses $2.83 bn to boost economic recovery

Central bank governor says Angola to achieve inflation targets in 2017

Zimbabwe sees 2016 budget deficit nearly 800 pct higher than forecast

Egypt's non-oil business activity falls to 40-month low

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currency

S&P Affirms SA’s foreign & domestic debt, Outlook remains negative

Nigeria’s central bank to sell $100 mln at forward, spot forex auction

S.Africa’s rand races to 2-month high after CPI dips, dovish Fed minutes

S.Africa’s central bank governor says raising rates won’t lure investment

Zimbabwe tax agency beats first quarter revenue target

Nigerian finance minister says country needs to tap its non-oil revenues

Nigeria needs reforms to hedge against future FX crisis – World Bank Africa economist

South Africa is on a cliff edge – just as it was in 1985

Tanzania hikes fuel prices on weaker currency

South Africa's MTN swings into first annual loss in 20 years

Nigeria steps nearer to devaluation with central bank dollar sale

S.African banking shares extend losses after watchdog charges

S.Africa Treasury says banks should be punished if currency rigging is true

Nigeria's central bank disburses $2.83 bn to boost economic recovery

Central bank governor says Angola to achieve inflation targets in 2017

Zimbabwe sees 2016 budget deficit nearly 800 pct higher than forecast

Egypt's non-oil business activity falls to 40-month low

News Tips

Advertise With Us

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