Zimbabwe central bank leaves rates unchanged, bullish on inflation, what you need to know…

News

South Africa’s Sasol cuts production, sales target due to COVID-19 lockdown

South African petrochemicals giant Sasol Ltd on Wednesday cut its guidance for synthetic fuel production and liquid fuel sales for this financial year due to a three-week nationwide lockdown linked to coronavirus.

How COVID-19 cooked the golden goose – The SA chef who went from golden days to zero.

“The smaller jobs would cover your costs and a big corporate gala dinner, with 200 people, would be the cherry on top,”

Safaricom, Vodacom partner to grow M-pesa across Africa

Safaricom and Vodacom recently announced the completion of the acquisition of the M-pesa brand as well as product development and support services from Vodafone through a newly created joint venture. This move is expected to accelerate M-pesa's growth in Africa. Sitoyo Lopokoiyit, Safaricom Chief Officer for Financial Services joins CNBC Africa for more.


HARARE, Feb 17 (Reuters) – Zimbabwe’s central bank left its benchmark interest rate at 35% on Monday, citing moderating inflation, as it looks to print more local currency and limit the use of foreign currencies.

Zimbabwe is struggling through its worst economic crisis in a decade, with prices of basic goods soaring and shortages of medicine, fuel and electricity worsening. Hopes of a quick recovery under President Emmerson Mnangagwa are fading.

The worsening poverty is upsetting the fragile calm that’s prevailed since the 2017 coup that toppled long-time ruler Robert Mugabe.

After suspending publication of annual inflation data, which economic analysts put at 525% in December, authorities will resume printing the figures next month.

Governor John Mangudya was bullish on inflation, projecting that annual price growth would dip below 50% by the end of the year. Monthly inflation fell in January to 2.23%

“Our task is we stabilize inflation and stabilize the exchange rate. We expect month-on-month inflation will continue to come down until the end of the year,” Mangudya said.

“Most of the inflation is caused by non-monetary factors. That is expectations – that ‘I lost money in 2008’,” Mangudya said. “This is a once-beaten, twice-shy scenario. These are things that shape inflation in Zimbabwe.”

Zimbabweans have little confidence in monetary policy after pensions and savings were wiped out at the height of hyperinflation, which reached 500 billion% in 2008 and forced the country to dump its local currency.

Last year in June, Zimbabwe ended a decade of dollarisation, which fuelled inflation. Mangudya said it would take up to five years to completely wean Zimbabwe from using the U.S. dollar in local transactions.

Seeking to reassure investors, the governor said foreign currency accounts held by companies, donors and individuals were safe, while businesses like mines would continue to receive a portion of their export earnings in dollars.

To ease shortages of cash, the bank will feed higher- denomination Zimbabwe dollar notes into the economy while increasing transparency on foreign currency trading to stabilise the exchange rate.

The central bank governor said he still saw economic growth at 3% in 2020, citing improved rainfall since mid January.

(Reporting by MacDonald Dzirutwe, writing by Mfuneko Toyana; editing by William Maclean, Larry King)

- Advertisement -
- Advertisement -

Featured

Rand hits record low, goes over 19 to dollar as Fitch downgrades SA further into junk status

Last Friday Moody’s, the last rating agency to rate South Africa investment grade, cut South Africa’s sovereign credit rating to junk in line with economists’ forecast. Today Fitch further downgraded the country sending the rand plunging over 19 rand to the dollar. Below it gives its reasons...

Subscribe to our newsletter

Sign up for free newsletters and get more CNBC AFRICA delivered to your inbox

Bank of Uganda slashes key interest rate to 8%

The Bank of Uganda has reduced its key interest rate by one percentage point to 8 per cent in efforts to mitigate the effects of the COVID-19 pandemic. Analyst Charles Bwogi joins CNBC Africa to discuss movements shaping the Ugandan market.

How African economies can survive the COVID-19 crisis

Governments on the continents have put forward strict measures in an effort to fight coronavirus of which, the impact will be greatly felt across the economies. The World Bank and the International Monetary Fund have stressed on the need to provide debt relief to developing countries. Grant Harris, CEO, Harris Partners LLC joins CNBC Africa for more.

Twitter CEO Jack Dorsey pledges $1 billion of Square stake for COVID-19 relief efforts

Twitter Inc (TWTR.N) Chief Executive Officer Jack Dorsey on Tuesday pledged $1 billion of his stake in Square Inc (SQ.N), the payments processor that he co-founded and heads, to help fund relief efforts related to the coronavirus pandemic.

Nigerian markets await DMO April bond auction

Traders say Nigeria’s April bond auction may not hold on the back of Nigeria's 14-day lockdown but adds that the Debt Management Office would keep paying this month’s coupons. Bankole Odusanya, Head of Fixed Income trading at UBA joins CNBC Africa for this discussion.
- Advertisement -

More Articles Like This

- Advertisement -