African central banks to focus on growth

Central banks across Africa are gearing up for a crucial week of deliberations on monetary policy stances, with a focus on tackling inflation and fostering economic growth. Ridle Markus, Africa Strategist at Absa CIB, shed light on the challenges and opportunities facing the continent's economies in an interview with CNBC Africa. The global landscape is grappling with soaring inflation rates, with the US and the UK witnessing the highest levels in decades. Africa is not immune to these pressures, with rising global inflation and supply chain disruptions impacting the continent's economies. Additionally, elevated commodity prices, especially fuel costs, are contributing to higher inflation rates in several African countries. Weather-related challenges, such as unfavorable weather conditions and low rainfall, are also driving up food inflation in the region. Against this backdrop, some African nations are set to release their latest inflation figures. Zambia is expected to see a decline in inflation thanks to a stronger currency and lower food prices. On the other hand, Uganda faces upward inflationary pressure due to issues like food shortages and rising transport costs. Looking ahead, higher inflation may remain a common theme for Africa in the coming months. Despite these challenges, major economies like Nigeria, Kenya, and Angola are unlikely to hike policy rates in the near term. Nigeria, for instance, is dealing with double-digit inflation but is expected to hold off on rate hikes until later in the year when the economic recovery gains momentum. Angola, on the other hand, grapples with high inflation and may consider a policy rate hike, although the decision remains uncertain. Meanwhile, Kenya is anticipated to maintain its policy rate as inflation eases and economic growth remains steady. Mozambique is also expected to keep rates steady to support ongoing recovery efforts. Zambia's significant debt burden poses a challenge in managing inflation. However, positive developments, such as currency stabilization and an upcoming IMF program, could help ease the inflationary pressure in the country. In conclusion, African central banks are navigating a complex economic landscape characterized by global inflation concerns and domestic challenges. Balancing the need to curb inflation with fostering economic growth will be a key priority for policymakers in the region.