<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/12/GettyImages-1251784454-820x547.jpg" alt="" class="wp-image-564339" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/12/GettyImages-1251784454-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/12/GettyImages-1251784454-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/12/GettyImages-1251784454-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/12/GettyImages-1251784454-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/12/GettyImages-1251784454-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/12/GettyImages-1251784454-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The World Bank Group headquarters during the spring meetings of the International Monetary Fund (IMF) and World Bank in Washington, DC, US, on Thursday, April 13, 2023. The IMF trimmed its global-growth projections, warning of high uncertainty and risks as financial-sector stress adds to pressures emanating from tighter monetary policy. Photographer: Samuel Corum/Bloomberg via Getty Images</figcaption></figure>



WASHINGTON, April 22 (Reuters)&nbsp;&#8211;&nbsp;Given big cuts in development aid by Europe and the United States, think tanks and other groups are urging the World Bank to reduce the equity-to-lending ratio of its main lending arm to free up billions in additional lending capacity.



Reducing the equity to lending ratio of the International Bank for Reconstruction and Development to 17% from 18% would allow the bank to boost its lending capacity by $30 billion to $40 billion without burdening taxpayers or shareholders, or jeopardizing its capital reserves, said Eric Pelofsky, vice president of the Rockefeller Foundation.



He said a large portion of these new resources could be used to provide loans to help governments rapidly address actual or anticipated budget gaps and shore up health-care networks, water and sanitation systems, or other critical public systems impacted by foreign aid cuts.



The bank could also offer short-term, low-interest loans to non-governmental organizations facing program cancellations, layoffs, and even bankruptcy that would help them bridge to new long-term funding models, Pelofsky said.



The World Bank voted last year to change its internal lending guidelines and lower its equity-to-lending ratio by 1 percentage point as part of reforms recommended by an independent commission for the Group of 20 major economies. It took a similar step in 2023, dropping the ratio to 19% from 20%.



Since U.S. President Donald Trump returned to office in January for a second term, his administration has cut billions of dollars in foreign assistance in a review that aimed to ensure programs align with his &#8220;America First&#8221; foreign policy. European governments have also cut their foreign aid budgets.



&#8220;Inaction will have concrete consequences,&#8221; Pelofsky said, citing studies which say U.S. foreign aid cuts could put millions of lives at risk.



Jubilee USA Network, a religious development group, said it backs the push, and it urged the World Bank to act quickly.



&#8220;The World Bank can and should make this decision as soon as possible,&#8221; said Eric LeCompte, the group&#8217;s executive director and a United Nations adviser. &#8220;With the significant cuts we&#8217;ve seen from the U.S. and Europe on development aid, this action by the World Bank can fill this aid gap.&#8221;



(Reporting by Andrea Shalal; Editing by Leslie Adler)

Spring Meetings Of The International Monetary Fund And World Bank

World Bank urged to reduce equity-to-loan ratio to free up funds for poor countries

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108134615-1745320819888-gettyimages-2209959602-UK_INFLATION-820x461.jpeg" alt="" class="wp-image-612440" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108134615-1745320819888-gettyimages-2209959602-UK_INFLATION-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108134615-1745320819888-gettyimages-2209959602-UK_INFLATION-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108134615-1745320819888-gettyimages-2209959602-UK_INFLATION-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108134615-1745320819888-gettyimages-2209959602-UK_INFLATION-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108134615-1745320819888-gettyimages-2209959602-UK_INFLATION-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108134615-1745320819888-gettyimages-2209959602-UK_INFLATION.jpeg 1600w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Shoppers pass along the high street in Maidstone, UK, on Wednesday, April 16, 2025. Bloomberg | Bloomberg | Getty Images</figcaption></figure>



The International Monetary Fund downgraded the U.K.’s 2025 growth forecast in its latest economic outlook released on Tuesday, warning that U.S. President Donald Trump’s trade tariffs, higher borrowing costs and increased energy prices will dent output this year.



In its reference forecast, the IMF predicted the British economy will grow 1.1%, down by 0.5 percentage points from its previous forecast issued in January. The fund now also expects the U.K. to grow by 1.4% in 2026, 0.1 percentage points lower than its previous estimate.



The figures were part of the IMF’s reference outlook, which does not include the tariff announcements made after April 4,&nbsp;such as the 90-day pause on the higher duties that Trump initially announced.



The downgrade for 2025 “reflects a smaller carryover from 2024, the impact of recent tariff announcements, an increase in gilt yields, and weaker private consumption amid higher inflation as a result of regulated prices and energy costs,” the IMF wrote in its World Economic Outlook report.



The downgrade pours more cold water on the U.K.’s Labour government which has made a main priority of growing the economy and is already contending with the uncertainty posed by trade tariffs from one of its largest trading partners, the U.S.



Trump announced a baseline 10% tariff on U.K. imports to the U.S. on April 2, despite Britain and the U.S. having almost balanced trade when it comes to the exchange of goods.



While the U.K. is hopeful it can strike a trade deal with the U.S., the White House leader’s mercurial stance on trade and tariffs has put financial institutions on edge.



The latest IMF downgrade for Britain echoes a similar downturn in domestic forecasts. In February, the Bank of England halved the U.K.’s growth projection for 2025 from 1.5% to 0.75%, warning of an uncertain global economic outlook and a sharp uptick in inflation later this year on the back of higher energy and water bills.



The U.K.’s Office for Budget Responsibility in March also halved its growth forecast for the U.K., slashing its outlook from 2% to 1% growth in 2025.



Despite the recent downgrades, the U.K. economy has shown some signs of life recently. The latest monthly growth data released earlier in April showed the economy grew by a larger-than-expected 0.5% month-on-month in February, from zero growth in January. National inflation, meanwhile, cooled to a lower-than-expected 2.6% in March.



The Bank of England appears sanguine on interest rate cuts as it looks to balance boosting growth with its predicted uptick in the inflation rate. Economists widely expect the BOE to cut its key interest rate from 4.5% to 4.25% at its next monetary policy meeting in May.



<h2 class="wp-block-heading" id="h-bright-spots-in-the-euro-zone"><a></a>Bright spots in the euro zone</h2>



Looking at the U.K.’s continental neighbors in the euro zone, the IMF predicted a slight decline in 2025 output, forecasting that growth in the euro area’s GDP will hit 0.8% in 2025, before picking up modestly to 1.2% in 2026.



“Rising uncertainty and tariffs are key drivers of the subdued growth in 2025,” the fund said. It noted that offsetting forces that support the modest uptick in 2026 include stronger consumption on the back of rising real wages, along with a projected fiscal easing in Germany following major changes to its fiscal rule, known as the “debt brake.”



<figure class="wp-block-image"><img decoding="async" src="https://image.cnbcfm.com/api/v1/image/108086018-1736840423739-gettyimages-1090698142-amf06159.jpeg?v=1736840447&amp;w=1858&amp;h=1045&amp;vtcrop=y" alt="Spain, holiday homes, tax"/><figcaption class="wp-element-caption">Spain, holiday homes, tax Westend61 | Westend61 | Getty Images</figcaption></figure>



The IMF singled out Spain as a bright spot in the euro zone, stating its growth momentum “contrasts with the sluggish dynamics elsewhere,” with the Mediterranean nation expected to expand its economy by 2.5% this year following an upward revision of 0.2 percentage points from the forecast made in January.



“This reflects a large carryover from better-than-expected outturns in 2024 and reconstruction activity following floods,” the IMF said.



Trump’s tariffs cast a shadow over the wider EU, however. The U.S. president initially imposed a 20% “reciprocal” tariff on all goods coming from the European Union but paused the measures for 90 days until early July, lowering the duty to 10% until that time.



As it looks to sign its own trade deal with the States in the interim, the EU paused its retaliatory duty targeting 21 billion euros ($24.1 billion) worth of U.S. goods “to allow time and space for EU-U.S. negotiations,” the European Commission said.

108134615-1745320819888-gettyimages-2209959602-UK_INFLATION

IMF slashes UK’s growth forecast, points to U.S. tariffs and borrowing costs

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="5000" height="3483" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/XFBSMRNLQVND3AANHME4FQBHPQ.avif" alt="" class="wp-image-612391"/><figcaption class="wp-element-caption">A severely malnourished child drinks from a bottle, at a camp for internally displaced people in Afdera town, Afar region, Ethiopia, February 23, 2022. REUTERS/Tiksa Negeri/File Photo</figcaption></figure>



GENEVA, April 22 (Reuters)&nbsp;&#8211;&nbsp;The World Food Programme suspended malnutrition treatment for 650,000 malnourished women and children in Ethiopia this week due to severe funding shortages, the U.N. agency said, with millions more at risk of losing access to aid.



WFP gets financing from 15-20 donors including the United States but many of them have cut funding this year, said Zlatan Milisic, WFP Country Director in Ethiopia. The agency has received exemptions from U.S. President Donald Trump&#8217;s aid freeze that has disrupted humanitarian work around the world, he added, but little for 2025 so far.



More than 10 million people in Ethiopia are gravely short of food, including 3 million displaced by conflict and extreme weather conditions as well as refugees from war-torn neighbouring Sudan, according to WFP.



Milisic said WFP had already reduced rations in recent months but that its operations were now at &#8220;breaking point&#8221; due to severe underfunding, forcing more drastic measures.



&#8220;We&#8217;ve been left no choice but to this week suspend treatment for 650,000 malnourished women and children — simply because we&#8217;ve run out of commodities and funding,&#8221; he told a Geneva press briefing by video from Addis Ababa.



A&nbsp;WFP&nbsp;spokesperson later added that those cut off were in various locations including the northern regions of Tigray and Afar, and that the U.N. agency is actively seeking funding to purchase more supplies to resume treatments.



Around 3.6 million people could lose access to assistance, including some being treated for malnutrition, if more funding is not received by June, Milisic added.



&#8220;I would hope that we will get the resources and put in place measures to really do our best to assist them. But if they don&#8217;t receive assistance, we will have serious consequences.&#8221;



Ethiopia&#8217;s food crisis has worsened in recent years as a result of a 2020-22 civil war in Tigray. The country also faced the Horn of Africa&#8217;s worst drought in decades in 2022.



WFP previously warned of a return of drought conditions to the region this year.



(Reporting by Emma Farge; editing by Mark Heinrich)

XFBSMRNLQVND3AANHME4FQBHPQ

Malnutrition treatments halted in Ethiopia due to underfunding, WFP says

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108133583-17449153292025-04-17t183309z_182229855_rc2uzdaji827_rtrmadp_0_usa-italy-820x461.jpeg" alt="" class="wp-image-612340" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108133583-17449153292025-04-17t183309z_182229855_rc2uzdaji827_rtrmadp_0_usa-italy-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108133583-17449153292025-04-17t183309z_182229855_rc2uzdaji827_rtrmadp_0_usa-italy-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108133583-17449153292025-04-17t183309z_182229855_rc2uzdaji827_rtrmadp_0_usa-italy-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108133583-17449153292025-04-17t183309z_182229855_rc2uzdaji827_rtrmadp_0_usa-italy-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108133583-17449153292025-04-17t183309z_182229855_rc2uzdaji827_rtrmadp_0_usa-italy-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108133583-17449153292025-04-17t183309z_182229855_rc2uzdaji827_rtrmadp_0_usa-italy.jpeg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">U.S. President Donald Trump speaks as he meets with Italian Prime Minister Giorgia Meloni (not pictured) in the Oval Office at the White House in Washington, D.C., U.S., April 17, 2025. Evelyn Hockstein | Reuters</figcaption></figure>



Yesterday’s edition of this newsletter cautioned that U.S. President Donald Trump’s desire to intervene in the Federal Reserve, as he expressed to reporters on Friday, could result in upheaval in the markets. That didn’t happen because markets were closed for the Good Friday holiday.



On Monday, trading resumed. So have Trump’s attacks on the central bank — and, more pointedly, on Fed Chair Powell, describing him as “Mr. Too Late” and “a major loser” for not cutting interest rates. Trump appointed Powell to the Federal Reserve’s highest seat in his first presidential term during 2017.



With no market closure to shield shares from Trump’s threats, investors unloaded their stocks. All major U.S. indexes fell, weighed down by steep declines in the “Magnificent Seven” group of shares. The U.S. dollar weakened to a three-year low while gold prices hit a new high, suggesting, in combination, that global investors are losing confidence in the U.S. economy and reallocating their capital to safer assets shielded from Trump.



<h2 class="wp-block-heading" id="h-what-you-need-to-know-today"><a></a>What you need to know today</h2>



Trump escalates attacks on Powell U.S. President Donald Trump on Monday renewed and escalated his attacks on Federal Reserve Chair Jerome Powell. ″‘Preemptive Cuts’ in Interest Rates are being called for by many,” Trump said on Truth Social. “There can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW,” Trump wrote, referring to Powell. On Friday, Trump also called for Powell to cut rates.



Stocks and U.S. dollar fall as gold hits high Stocks in the U.S. fell Monday. The S&amp;P 500 lost 2.36%, the Dow Jones Industrial Average tumbled 2.48% and the Nasdaq Composite was down 2.55%. The ICE U.S. Dollar Index fell as low as 97.92 on Monday, the lowest level since March 2022, according to FactSet. Gold prices jumped to $3,452.30 per ounce, a fresh record. Asia-Pacific markets traded mixed Tuesday. Hong Kong’s Hang Seng Index climbed nearly 0.5% but Japan’s Nikkei 225 declined roughly 0.2%. The Bank of Japan will likely pause rate hikes in its May meeting, said Moody’s Analytics.



Shares of Tesla drop before earnings Tesla shares fell almost 6% on Monday, a day ahead of its first-quarter earnings report. The stock is now down 44% for the year after wrapping up their worst quarter since 2022 in March. In the online forum that Tesla solicits investor inquiries before its earnings calls, one investor, referring to CEO Elon Musk, asked, “What steps has the board of directors taken to mitigate the brand damage caused by Elon’s political activities?”



Vance and Modi optimistic on deal India’s Prime Minister Narendra Modi met U.S. Vice President JD Vance, who was in India for a mostly personal trip, in the nation’s capital on Monday. A statement from Modi’s office said the two leaders “welcomed the significant progress in the negotiations for a mutually beneficial India-U.S. Bilateral Trade Agreement.” On Monday, U.S. Trade Representative Jamieson Greer said both countries have “finalized the terms of reference to lay down a roadmap for the negotiations on reciprocal trade.”



Nomura to buy parts of Macquarie Japanese investment bank and brokerage group Nomura said Tuesday it will buy the U.S. and European public asset management businesses of Macquarie, an Australian investment banking company, for $1.8 billion. The all-cash deal is expected to close by the end of this year, subject to regulatory approvals.



[PRO] Markets could have ‘severe’ reaction to Trump Stocks and bonds would likely have a “severe reaction” and sell off sharply if Trump makes a move to get rid of Federal Reserve Chair Jerome Powell, Evercore ISI’s vice chairman, Krishna Guha, told CNBC’s “Squawk Box” Monday. While Powell has said he doesn’t believe the president can legally remove the Fed Chair, Guha highlighted one way that Trump can pressure Powell without firing him.



<h2 class="wp-block-heading" id="h-and-finally"><a></a>And finally&#8230;</h2>



<figure class="wp-block-image"><img decoding="async" src="https://image.cnbcfm.com/api/v1/image/108131827-1744683718571-gettyimages-2203962201-baglietto-notitle250310_np76O.jpeg?v=1745301518&amp;w=1858&amp;h=1045&amp;vtcrop=y" alt="U.S. one hundred dollar bills."/><figcaption class="wp-element-caption">Nurphoto | Nurphoto | Getty Images</figcaption></figure>



As the dollar falters, the world’s central banks tread a tightrope — devalue their currency or not



Uncertainty about U.S. policymaking has led to a flight from the greenback and Treasurys in recent weeks, with the dollar index weakening more than 9% so far this year. The drop in the U.S. dollar has led other currencies to appreciate against it, especially safe havens such as the Japanese yen, the Swiss franc and the euro.



While a stronger local currency might help tame inflation through cheaper imports, it complicates export competitiveness particularly under renewed U.S. tariffs, said Thomas Rupf, VP Bank’s co-head for Singapore and Asia chief investment officer.



Currency devaluation is likely to be more of an active consideration across emerging markets, particularly in Asia, said Nick Rees, head of macro research at Monex Europe. However, those countries and Asian central banks will need to tread a fine line to avoid capital flight and other risks.

108133583-17449153292025-04-17t183309z_182229855_rc2uzdaji827_rtrmadp_0_usa-italy

Investors grow wary of U.S. assets as Trump intensifies attacks on Powell

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="768" height="402" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1Dm0ee.jpg" alt="" class="wp-image-612268" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1Dm0ee.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1Dm0ee-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1Dm0ee-160x84.jpg 160w" sizes="auto, (max-width: 768px) 100vw, 768px" /><figcaption class="wp-element-caption">Nurphoto | Nurphoto | Getty Images</figcaption></figure>



The dollar has been sliding and the ripple effect on other currencies has brought a mix of relief and headache to central banks around the world.



Uncertainty about U.S. policymaking has led to a flight out of the U.S. dollar and Treasurys in recent weeks, with the dollar index weakening more than 9% so far this year. Market watchers see further declines.&nbsp;



According to Bank of America’s most recent Global Fund Manager Survey, a net 61% of participants anticipate a decline in the dollar’s value over the next 12 months — the most pessimistic outlook of major investors in almost 20 years.



The exodus from U.S. assets may reflect a broader crisis of confidence, with potential spillovers such as higher imported inflation as the dollar weakens.



The drop in the greenback has led other currencies to appreciate against it, especially safe havens such as the Japanese yen, the Swiss franc as well as the euro.



Since the start of the year, the Japanese yen has strengthened over 10% against the greenback, while the Swiss franc and the euro has appreciated about 11%, according to LSEG data.



Aside from the safe havens, other currencies that have strengthened against the dollar this year include the Mexican peso, up 5.5% against the dollar, and the Canadian dollar which has appreciated over 4%. The Polish zloty has strengthened more than 9% while and Russian rouble has appreciated over 22% against the greenback.



Some emerging market currencies, however, have depreciated despite the weakness in the greenback.



The Vietnamese dong and Indonesian rupiah weakened to a record low per U.S. dollar earlier this month. The Turkish lira also hit an all-time low last week. China’s yuan hit a record low against the dollar nearly two weeks back but has since strengthened.&nbsp;



<h2 class="wp-block-heading" id="h-breathing-room-to-cut-rates"><a></a>Breathing room to cut rates?</h2>



Barring a few exceptions like the Swiss National Bank, a weakening U.S. dollar is a relief to governments and central banks around the world, analysts told CNBC.



“Most central banks would be happy to see 10%-20% declines in the U.S. dollar,” said Adam Button, chief currency analyst at ForexLive. He added that the dollar strength has been a persistent problem for years and poses a difficulty for countries with hard and soft dollar pegs.



With many emerging market countries having large dollar-denominated debt, a weaker dollar lowers real debt burden. Additionally, a softer greenback and stronger local currency tend to make imports relatively cheaper, lowering inflation and hence allowing central banks the room to cut rates to boost growth.



The recent U.S. dollar sell-off offers more “breathing room” for central banks to cut rates, said Button.&nbsp;



While a stronger local currency might help tame inflation via cheaper imports, it complicates export competitiveness particularly under renewed U.S. tariffs where Asia is exposed as the world’s largest goods producer, said Thomas Rupf, VP Bank’s co-head for Singapore and Asia chief investment officer.



Currency devaluation is likely to be more of an active consideration across emerging markets, particularly in Asia, said Nick Rees, head of macro research at Monex Europe.



However, these emerging markets and Asian central banks will need to tread a fine line, to avoid capital flight and other risks.



“Emerging markets face high inflation, debt, and capital flight risks, making devaluation dangerous,” said Wael Makarem, financial markets strategists lead at Exness.



Additionally, devaluation could be seen by the U.S. administration as a trade measure which could attract retaliation, he added.



Emerging market economies may be reluctant to cut rates as it can affect the debt burden of domestic households and firms that have borrowed in U.S. dollars, said Fitch Ratings’ director of economics, Alex Muscatelli. A weaker domestic currency can also lead to capital outflows in response to lower interest differentials with the U.S., he added.



For example, Muscatelli does not see Indonesia’s central bank cutting rates too much given the recent currency volatility, but cited that Korea and India may have space for cutting rates.



The European Central Bank took the opportunity offered by declining inflation to cut rates by another 25 basis point at its April meeting. The ECB on Thursday said that “Most measures of underlying inflation suggest that inflation will settle at around the Governing Council’s 2% medium-term target on a sustained basis.”



Another example is the Swiss National Bank, which has grappled with a strong franc for much of the past 15 years, observed Button. Exports of goods and services make up over 75% of Switzerland’s GDP and a strong franc makes Swiss goods more expensive abroad.



“If capital continues to flow in, they may have to take drastic measures to devalue,” he said. Investors flood into the franc during times of uncertainties, such as in recent weeks, strengthening the franc.



<h2 class="wp-block-heading"><a></a>Central banks are avoiding devaluation — for now</h2>



Devaluing the currency poses the risk of stoking price growth and monetary authorities will be wary of inflation staying above their targets.



The risk of higher inflation arising from currency depreciation as well as tariffs — as countries respond to U.S. levies — are likely to make central banks reluctant to pursue a path of voluntary devaluation, said Wells Fargo’s international economist and FX strategist, Brendan McKenna.



On top of that, while most foreign central banks do theoretically have the bandwidth to weaken their own currency, the likelihood is still low in the current environment, the strategist added.



Whether a country can devalue its currency is influenced by several factors: the size of its FX reserves, exposure to foreign debt, its trade balance, and sensitivity to imported inflation.&nbsp;



“Export-oriented countries with sufficient reserves and lower reliance on foreign debt would have more room to devalue – but even those are likely to tread carefully,” said McKenna.&nbsp;



The broader direction of trade negotiations will be key to how countries choose to act. Aside from China, several countries have displayed a willingness to engage in trade negotiations, and if these talks lead to lower tariffs, then central banks will not be as likely to pursue weaker currencies, he added.



In the current geopolitical climate, devaluation could also invite retaliation and risks of accusations of currency manipulation, said VP Bank’s Rupf.



Though there is still the possibility that trade tensions could lead to more protectionist outcomes, which will drive central banks toward devaluing their currencies.



“But for now, it seems the preferred action is avoiding a currency war that would only add more instability to the local and global economy,” McKenna said.

AA1Dm0ee

As the dollar falters, the world’s central banks tread a tightrope — devalue their currency or not

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="800" height="533" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/E5GSUAFYBFMNLBT3RJYNBKBCIU.jpg" alt="" class="wp-image-610556" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/E5GSUAFYBFMNLBT3RJYNBKBCIU.jpg 800w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/E5GSUAFYBFMNLBT3RJYNBKBCIU-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/E5GSUAFYBFMNLBT3RJYNBKBCIU-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/E5GSUAFYBFMNLBT3RJYNBKBCIU-768x512.jpg 768w" sizes="auto, (max-width: 800px) 100vw, 800px" /><figcaption class="wp-element-caption">FILE PHOTO: High-tension electrical power lines are seen at the Azura-Edo Independent Power Plant (IPP) on the outskirt of Benin City in Edo state, Nigeria June 13, 2018. REUTERS/Akintunde Akinleye/File Photo</figcaption></figure>



LAGOS, April 17 (Reuters)&nbsp;&#8211;&nbsp;Nigeria has achieved a 35% reduction in electricity subsidies following a tariff increase implemented last year for some users, Power Minister Adebayo Adelabu said on Thursday, easing some pressure on public finances in Africa&#8217;s most populous nation.



Nigeria&#8217;s power sector is burdened by a failing grid, gas shortages, high debt and vandalism, leading to a reliance on expensive generators for many.



The country was spending nearly 200 billion naira ($125.01 million) monthly on electricity subsidies because existing tariffs were not commercially viable.



The government last year eliminated subsidies for the 15% of customers classified as heavier users, including households and businesses consuming larger amounts of electricity.



Adelabu told a press briefing in Abuja that this targeted tariff adjustment has yielded significant results, with &#8220;the market generating an additional 700 billion naira in revenue, reflecting a 70% increase&#8221;.



This has helped alleviate the substantial financial strain on public finances, improve generation, and reduce the government&#8217;s tariff shortfall from 3 trillion naira to 1.9 trillion naira.



But the power sector still faces deep-rooted challenges. The country has an installed capacity of 13,000 megawatts, but typically produces only about a third of that, exacerbating the reliance on costly alternatives.



This situation is compounded by state-controlled power tariffs that have historically been too low for distribution companies to cover their costs and pay generating companies, leading to ballooning debts within the sector.



Debt owed to power generating companies has reached 4 trillion naira ($2.50 billion), prompting threats of plant shutdowns.



Adelabu said there were plans underway to help ease the debt burden, with the government intending to pay half of the debt this year through budgetary allocations and promissory notes that companies can discount as needed.



($1 = 1,599.8300 naira)



(Reporting by Isaac Anyaogu; Editing by Frances Kerry)

FILE PHOTO: High-tension electrical power lines are seen at the Azura-Edo IPP on the outskirt of Benin City

Nigeria cuts electricity subsidies by 35% after tariff hike

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="5000" height="3333" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/03/TK6CHSZXDJPLLBYFHHDN2UBZGY.avif" alt="" class="wp-image-596859"/><figcaption class="wp-element-caption">South Africa&#8217;s Finance Minister Enoch Godongwana delivers his 2025 budget speech in Cape Town, South Africa, March 12, 2025. REUTERS/Esa Alexander/File Photo</figcaption></figure>



JOHANNESBURG, April 17 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s finance minister has said that failing to raise the value-added tax rate from May would cause severe harm to state finances, court papers showed, after a stand-off over the proposal risked the stability of the coalition government.



The two biggest parties in the coalition government, the African National Congress and the Democratic Alliance have been at odds over the proposal to raise VAT by 0.5 percentage points on May 1 and another 0.5 points next year.



VAT is currently at 15%.



In response to the pro-business DA challenging the legality of the VAT hike plan in court, Finance Minister Enoch Godongwana argued that any delay or removal of the VAT hike would have dire consequences on the country&#8217;s finances.



&#8220;If the rate increase is halted now, that revenue will be lost, and the state will be left without the funds needed to meet already-budgeted spending commitments,&#8221; Godongwana said in papers lodged with the court on Wednesday.



&#8220;The consequences would be severe and far-reaching. Government would be immediately forced either to cut expenditure or to increase borrowing.&#8221;



Lawmakers have the power to amend or withdraw the impending VAT hike through upcoming budget votes.



Some smaller political parties have put forward proposals that would include deeper expenditure cuts instead of a VAT hike.



Local news headlines last weekend had suggested the ANC was likely to drop its insistence on a VAT hike this year after indications that none of the parties it had been talking to would support it.



Godongwana also conceded on state broadcaster SABC on Wednesday that wrangling over a 0.5 percentage point increase in VAT might not be in the broader public interest.



South Africa&#8217;s National Treasury estimates that raising VAT will generate about 13.5 billion rand in additional revenue for the 2025/26 financial year.



(Reporting by Tannur Anders and Kopano Gumbi; Editing by Alison Williams)

TK6CHSZXDJPLLBYFHHDN2UBZGY

South Africa finance minister says dropping VAT hike would have severe consequences

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="4896" height="3264" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/Q3NXJVS5NBOAXBD3CUPARMV36I.avif" alt="" class="wp-image-610485"/><figcaption class="wp-element-caption">Miners process fine dust and soil as they search for gold at a miners settlement in Anka, Zamfara, Nigeria. April 21, 2016, REUTERS/Afolabi Sotunde/File Photo</figcaption></figure>



ABUJA, April 17 (Reuters)&nbsp;&#8211;&nbsp;Nigeria and South Africa have signed an accord to boost cooperation in mining, Nigeria&#8217;s mines minister said on Thursday, highlighting Abuja&#8217;s push to diversify its economy away from oil.



Mines Minister Dele Alake said the two countries will partner on mining, including geological mapping using drones, share mineral data, and jointly explore agro and energy minerals in Nigeria.



Besides oil, Nigeria is also rich in gold, limestone, lithium, iron ore and zinc. Nigeria has around 23 mineral deposits in commercial quantities.



Nigeria is seeking to revamp a mining sector that has long been underdeveloped, contributing less than 1% to its gross domestic product.



South Africa&#8217;s established mining expertise makes it a key partner in this effort, Alake said.



(Reporting by Camillus Eboh; Editing by Elisha Bala-Gbogbo and David Evans)

Q3NXJVS5NBOAXBD3CUPARMV36I

Nigeria signs minerals pact with South Africa in diversification push

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-820x547.jpg" alt="" class="wp-image-505639" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-768x513.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-1536x1025.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A South African one rand coin sits on South African rand banknotes in this arranged photograph in Pretoria, South Africa, on Wednesday, Aug. 14, 2019. The rand ended a tumultuous week on a positive note, gaining against the dollar for a second day and heading for its first weekly advance in four as technical indicators suggested recent declines are overdone. Photographer: Waldo Swiegers/Bloomberg via Getty Images</figcaption></figure>



JOHANNESBURG, April 17 (Reuters) &#8211; South Africa&#8217;s rand weakened early on Thursday against a firmer dollar, as markets awaited information on U.S. tariffs and local investors looked for news on the future of the coalition government.



At 0635 GMT, the rand traded at 18.8550 against the U.S. dollar, about 0.2% weaker than its previous close.



The dollar last traded about 0.3% stronger against a basket of currencies.



&#8220;Ahead of the Easter long weekend, investors will be reluctant to take on any significant market position. There are so many daily changes that doing so would be risky,&#8221; ETM Analytics said in a research note.



U.S. President Donald Trump met with Japanese officials on Wednesday, in one of the first rounds of face-to-face talks since his tariffs on most countries roiled markets and stoked recession fears.



Markets were also processing comments from Federal Reserve Chair Jerome Powell, who warned of the risk of slowing growth and rising prices due to tariffs.



Like other risk-sensitive currencies, the rand takes direction from global drivers such as U.S. economic policy in addition to domestic factors.



Local investors will eye developments around a budget stand-off between the two biggest parties in the coalition government, the African National Congress (ANC) and the Democratic Alliance (DA), over a proposed value-added tax (VAT) hike on May 1.



The pro-business DA voted against the budget&#8217;s fiscal framework in parliament and is challenging the VAT hike in court, raising concerns among investors over the stability of the coalition government.



&#8220;All of (South Africa&#8217;s) domestic political developments are not taking place in isolation. On the contrary, if left unresolved, they may compound an already uncertain international environment,&#8221; ETM Analytics said.



&#8220;The ZAR is therefore expected to trade cautiously with one eye on local developments and the other on the performance of the USD.&#8221;



South Africa&#8217;s benchmark 2030 government bond was firmer in early deals, with the yield down 2 basis points to 9.16%.



(Reporting by Tannur Anders; Editing by Jamie Freed)

South African Rand Rebound Snaps Streak of Weekly Losses

South African rand weaker as markets await tariff, local government news

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="410" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108130007-1744293710285-gettyimages-2208850679-AA_10042025_2168828-820x410.jpeg" alt="" class="wp-image-610430" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108130007-1744293710285-gettyimages-2208850679-AA_10042025_2168828-820x410.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108130007-1744293710285-gettyimages-2208850679-AA_10042025_2168828-300x150.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108130007-1744293710285-gettyimages-2208850679-AA_10042025_2168828-160x80.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108130007-1744293710285-gettyimages-2208850679-AA_10042025_2168828-768x384.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108130007-1744293710285-gettyimages-2208850679-AA_10042025_2168828.jpeg 884w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Dilara Irem Sancar | Anadolu | Getty Images</figcaption></figure>



China last week announced it was done retaliating against U.S. President Donald Trump’s tariffs, saying any further increases by the U.S. would be a “joke,” and Beijing would “ignore” them.



Instead of continuing to focus on tariffing goods, however, China has chosen to resort to other measures, including steps targeting the American services sector.



Trump has jacked up U.S. levies on select goods from China by up to 245% after several rounds of tit-for-tat measures with Beijing in recent weeks. Before calling it a “meaningless numbers game,” China last week imposed additional duties on imports from the U.S. of up to 125%.



While the Trump administration has largely focused on pressing ahead with tariff plans, Beijing has rolled out a series of non-tariff restrictive measures including widening export controls of rare-earth minerals and opening antitrust probes into American companies, such as pharmaceutical giant DuPont and IT major Google.



Before the latest escalation, in February Beijing had put dozens of U.S. businesses on a so-called “unreliable entity” list, which would restrict or ban firms from trading with or investing in China. American firms such as PVH, the parent company of Tommy Hilfiger, and Illumina, a gene-sequencing equipment provider, were among those added to the list.



Its tightening of exports of critical mineral elements will require Chinese companies to secure special licenses for exporting these resources, effectively restricting U.S. access to the key minerals needed for semiconductors, missile-defense systems and solar cells.



In its latest move on Tuesday, Beijing went after Boeing — America’s largest exporter — by ordering Chinese airlines not to take any further deliveries for its jets and requested carriers to halt any purchases of aircraft-related equipment and parts from U.S. companies, according to Bloomberg.



Having deliveries to China cut off will add to the cash-strapped plane maker’s troubles, as it struggles with a lingering quality-control crisis.



In another sign of growing hostilities, Chinese police issued notices for apprehending three people they claimed to have engaged in cyberattacks against China on behalf of the U.S. National Security Agency.



Chinese state media, which published the notice, urged domestic users and companies to avoid using American technology and replace them with domestic alternatives.



“Beijing is clearly signaling to Washington that two can play in this retaliation game and that it has many levers to pull, all creating different levels of pain for U.S. companies,” said Wendy Cutler, vice president at Asia Society Policy Institute.



“With high tariffs and other restrictions in place, the decoupling of the two economies is at full steam,” Cutler said.



<h2 class="wp-block-heading" id="h-targeting-trade-in-services"><a></a>Targeting trade in services</h2>



China is seen by some as seeking to broaden the trade war to encompass services trade — which covers travel, legal, consulting and financial services — where the U.S. has been running a significant surplus with China for years.



Earlier this month, a social media account affiliated with Chinese state media Xinhua News Agency, suggested Beijing could impose curbs on U.S. legal consultancy firms and consider a probe into U.S. companies’ China operations for the huge “monopoly benefits” they have gained from intellectual-property rights.



China’s imports of U.S. services surged more than 10-fold to $55 billion in 2024 over the past two decades, according to Nomura estimates, driving U.S. services trade surplus with China to $32 billion last year.



Last week, China said it would reduce imports of U.S. films and warned its citizens against traveling or studying in the U.S., in a sign of Beijing’s intent to put pressure on the U.S. entertainment, tourism and education sectors.



“These measures target high-visibility sectors — aviation, media, and education — that resonate politically in the U.S.,” said Jing Qian, managing director at Center for China Analysis.



While they might be low on actual dollar impact given the smaller scale of these sectors, “reputational effects — such as fewer Chinese students or more cautious Chinese employees — could ripple through academia and the tech talent ecosystem,” he added.



Nomura estimates $24 billion could be at stake if Beijing significantly step up restrictions on travel to the U.S.

108130007-1744293710285-gettyimages-2208850679-AA_10042025_2168828

China targets U.S. services and other areas as it decries ‘meaningless’ tariff hikes on goods

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108071122-1733319291213-gettyimages-2187589196-AFP_36PC93X-820x461.png" alt="" class="wp-image-610146" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108071122-1733319291213-gettyimages-2187589196-AFP_36PC93X-820x461.png 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108071122-1733319291213-gettyimages-2187589196-AFP_36PC93X-300x169.png 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108071122-1733319291213-gettyimages-2187589196-AFP_36PC93X-160x90.png 160w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108071122-1733319291213-gettyimages-2187589196-AFP_36PC93X-768x432.png 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/108071122-1733319291213-gettyimages-2187589196-AFP_36PC93X.png 1200w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Cargo ships and containers at Qingdao port in eastern China’s Shandong province on Dec. 4, 2024. Stringer | Afp | Getty Images</figcaption></figure>



The World Trade Organization (WTO) warned on Wednesday that the outlook for global trade has “deteriorated sharply” in the wake of U.S. President Donald Trump’s tariffs regime.



“The outlook for global trade has deteriorated sharply due to a surge in tariffs and trade policy uncertainty,” the WTO said in its latest “Global Trade Outlook and Statistics” report out Wednesday.



Based on the tariffs currently in place, and including a 90-day suspension of “reciprocal tariffs,” the volume of world merchandise trade is now expected to decline by 0.2% in 2025, before posting a “modest” recovery of 2.5% in 2026.



The decline is anticipated to be particularly steep in North America, where exports are forecasted to drop by 12.6% this year.



The WTO also warned that “severe downside risks exist,” including the application of “reciprocal” tariffs and a broader spillover of policy uncertainty, “which could lead to an even sharper decline of 1.5% in global goods trade,” particularly hurting export-oriented, least-developed countries.



The recent tariff disturbances follow a strong year for world trade in 2024, during which merchandise trade grew 2.9% and commercial services trade expanded by 6.8%, the WTO said.



The new estimate of a 0.2% decline in world trade for 2025 is nearly three percentage points lower than it would have been under a “low tariff” baseline scenario, the WTO added, and marks a significant reversal from the start of the year when the trade body’s economists expected to see continued trade expansion supported by improving macroeconomic conditions.



“Risks to the forecast include the implementation of the currently suspended reciprocal tariffs by the United States, as well as a broader spillover of trade policy uncertainty beyond U.S.-linked trade relationships,” the WTO said.



“If enacted, reciprocal tariffs would reduce world merchandise trade growth by an additional 0.6 percentage points, posing particular risks for least-developed countries (LDCs), while a spreading of trade policy uncertainty (TPU) would shave off a further 0.8 percentage points. Taken together, the reciprocal tariffs and spreading TPU would lead to a 1.5% decline in world merchandise trade volume in 2025.”



<figure class="wp-block-image"><img decoding="async" src="https://image.cnbcfm.com/api/v1/image/108127151-17438709982025-04-04t234656z_1270263179_rc2xpdazxgbd_rtrmadp_0_usa-trump-tariffs.jpeg?v=1744047527&amp;w=1858&amp;h=1045&amp;vtcrop=y" alt="U.S. President Donald Trump delivers remarks on tariffs in the Rose Garden at the White House in Washington, D.C., U.S., April 2, 2025. REUTERS/Carlos Barria"/><figcaption class="wp-element-caption">U.S. President Donald Trump delivers remarks on tariffs in the Rose Garden at the White House in Washington, D.C., on April 2, 2025. Carlos Barria | Reuters</figcaption></figure>



Trump stunned trading partners and global markets in early April, when he announced a raft of “reciprocal” tariffs on imports from more than 180 countries. Beijing was hit the hardest of all, with the U.S. duty on Chinese imports now effectively totaling 145%. China in turn hit back at Washington with retaliatory tariffs of up to 125% on U.S. imports.



Widespread market turbulence following the tariffs announcement prompted a temporary climbdown by Trump, with the president last week announcing that the new duties on imports from most trading partners would be reduced to 10% for 90 days in order to allow for trade negotiations with Washington’s counterparts.



The WTO said in its Wednesday report that the impact of recent trade policy changes is likely to vary sharply from region to region.



In the adjusted forecast, North America now subtracts 1.7 percentage points from global merchandise trade growth in 2025, turning the overall figure negative.



Meanwhile, Asia and Europe continue to contribute positively, but less than in the baseline scenario, with Asia’s input halved to 0.6 percentage points.



The disruption in U.S.-China trade is expected “to trigger significant trade diversion,” the WTO added, raising concerns among third markets about increased competition from China.



“Chinese merchandise exports are projected to rise by 4% to 9% across all regions outside North America as trade is redirected. At the same time, U.S. imports from China are expected to fall sharply in sectors such as textiles, apparel and electrical equipment, creating new export opportunities for other suppliers able to fill the gap,” the trade organization remarked, noting that this could open the door for some least-developed countries to increase their exports to the U.S. market.

108071122-1733319291213-gettyimages-2187589196-AFP_36PC93X

Global trade outlook has ‘deteriorated sharply’ amid Trump tariff uncertainty, WTO warns

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1080" height="720" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/N7NTFVJZNNKH5L7JQ3FQOLPYO4.avif" alt="" class="wp-image-610095"/><figcaption class="wp-element-caption">A view shows a PwC Australia logo in Melbourne, Australia, March 24, 2025. REUTERS/Hollie Adams/File Photo</figcaption></figure>



April 16 (Reuters)&nbsp;&#8211;&nbsp;PwC shut operations in nine Sub-Saharan African countries last month following a strategic review, the Big Four accounting firm said, in response to a media report that said the company exited over a dozen countries to avoid scandals.



PwC, which operates as a global network of locally owned partnerships, has shut operations in the Ivory Coast, Gabon, Cameroon, Madagascar, Senegal, the Democratic Republic of Congo (DRC), Congo Republic, Republic of Guinea and Equatorial Guinea, it said in a statement published on its website on March 31.



The accounting firm directed Reuters to the statement in response to queries on a Financial Times article published earlier in the day that said PwC had exited multiple countries that were deemed too small, risky or unprofitable.



The decision came due to mounting differences with local partners, who said they lost over a third of their business in recent years after pressure from PwC&#8217;s global executives to drop risky clients, the FT said, citing people familiar with the matter.



The PwC statement did not give a reason for the move.



The FT report, citing a register of PwC entities and local news reports, said PwC had also cut ties with member firms in Zimbabwe, Malawi and Fiji.



PwC has faced an exodus of clientele and layoffs across countries since last year.



PwC&#8217;s mainland China unit was hit with a $62 million fine and six-month suspension for audit failures related to property developer China Evergrande&#8217;s&nbsp;3333.HK&nbsp;$78 billion fraud.



Last month, Britain fined PwC about $6 million in relation to the audit of Wyelands Bank for financial year 2019.



The firm is working with Saudi Arabia and its sovereign wealth fund to mend relations after the kingdom suspended activities between the $925 billion fund&#8217;s holding company and PwC. ($1 = 0.7531 pounds)



(Reporting by Bipasha Dey, Kanjyik Ghosh and Harshita Meenaktshi in Bengaluru; Editing by Savio D&#8217;Souza and Mrigank Dhaniwala)

N7NTFVJZNNKH5L7JQ3FQOLPYO4

PwC shuts operations in nine African countries

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="768" height="402" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1yXNHy.jpg" alt="" class="wp-image-610037" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1yXNHy.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1yXNHy-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1yXNHy-160x84.jpg 160w" sizes="auto, (max-width: 768px) 100vw, 768px" /><figcaption class="wp-element-caption">A general view of people visiting the Trafalgar Tavern pub decorated with bunting and string lights on the bank of the River Thames in Greenwich on December 16, 2023 in London, United Kingdom.  John Keeble | Getty Images News | Getty Images</figcaption></figure>



The U.K.’s annual inflation rate fell to 2.6% in March, coming in below analyst expectations, according to data released by the Office for National Statistics (ONS) on Wednesday.



Economists polled by Reuters had anticipated the consumer price index would hit 2.7% in the twelve months to March.



The rate of price rises in Britain hit 2.8% in February, after rising sharply to 3% in January.



Core inflation, which excludes more volatile energy, food, alcohol and tobacco prices, rose by 3.4% in the year to March, down slightly from 3.5% in February.



The largest downward contributions to the monthly change in the inflation rate came from recreation and culture, and motor fuels, the ONS said, while the largest upward driver was clothing.



Sterling was up 0.25% against the U.S. dollar at $1.3265, following the data release.



The latest data will be analyzed closely by policymakers at the Bank of England,&nbsp;who are expected to cut interest rates when they next convene on May 8. The BOE held rates at 4.5% at its previous meeting in March amid a forecasted inflation hike and uncertainty over economic growth and global trade under U.S. President Donald Trump’s tariffs.



There was good news for the U.K. last week, when the latest monthly growth data showed that the British economy grew by 0.5% month-on-month in February. The U.K. is also hoping to sign a trade deal with Washington, having escaped relatively unscathed from Trump’s tariffs regime with just a baseline 10% duty on imports to the States.



Traders will be looking closely at the BOE’s next policy statement on Thursday for its assessment of the economic outlook for the country.



In a statement out in March, the central bank said “global trade policy uncertainty has intensified, and the United States has made a range of tariff announcements, to which some governments have responded.”



“Other geopolitical uncertainties have also increased and indicators of financial market volatility have risen globally,” it added.



The BOE warned in February that it expected inflation to temporarily rise to 3.7% in the third quarter of this year, as energy costs are set to accelerate. At the time, it also halved its 2025 growth forecast for the U.K. to 0.75%.



Ruth Gregory, deputy chief U.K. economist at Capital Economics, was among the analysts noting that the slowdown in inflation was not expected to last.



“The dip &#8230; won’t be sustained for long, with inflation set to rise to around 3.5% in the coming months. But we think a weak economy will quash inflation eventually and that the tariff shock has tilted the balance of risks towards lower inflation and faster falls in interest rates,” she said in emailed comments Wednesday.



“For now, we are sticking to our view that inflation will gradually fall to 2.0% in 2026. But the risks to that forecast appear to be increasingly skewed to the downside,” she added.

AA1yXNHy

UK inflation slows to cooler-than-expected 2.6% in March

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="5000" height="3333" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/TAOPHOKM7NIDBDA6H6FJ4X5RX4.avif" alt="" class="wp-image-609776"/><figcaption class="wp-element-caption">A general view of Tejuosho Market in Yaba, in Nigeria&#8217;s commercial capital Lagos, Nigeria, April 15, 2025. REUTERS/Sodiq Adelakun</figcaption></figure>



ABUJA, April 15 (Reuters) &#8211; Nigeria&#8217;s headline consumer inflation edged up to 24.23% year-on-year in March from 23.18% in February, its statistics agency said on Tuesday.



A report by the National Bureau of Statistics showed price rises for food and non-alcoholic beverages were the biggest contributor to annual inflation.



Inflation in Africa&#8217;s most populous country soared to repeated 28-year peaks last year, spurred by President Bola Tinubu&#8217;s moves to curb costly subsidies and devalue the naira currency after he came to power in 2023.



A rebasing exercise by the statistics bureau, in which the items in its reference basket were reweighted and the comparison period was updated from 2009 to 2024, saw the annual inflation rate fall from 34.80% in December to 24.48% in January.



(Reporting by Elisha Bala-Gbogbo; Additional reporting by Mohd Edrees and Bhargav Acharya; Editing by Alexander Winning)

TAOPHOKM7NIDBDA6H6FJ4X5RX4

Nigeria’s annual inflation picks up to 24.23% in March

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="5000" height="3333" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/V6NUKK56AFOQRIE7VW57VUR2DU.avif" alt="" class="wp-image-609645"/><figcaption class="wp-element-caption">Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., April 14, 2025. REUTERS/Brendan McDermid/File Photo</figcaption></figure>



LONDON, April 15 (Reuters)&nbsp;&#8211;&nbsp;Global investors have slashed their holdings of U.S. stocks by a record amount in the past two months, a trend that is likely to continue given a record number of managers say they plan to keep cutting their exposure, BofA Global Research said on Tuesday.



Respondents to BofA&#8217;s monthly survey of fund managers were a net 36% underweight U.S. equities, the most in nearly two years, a number that has plunged by 53 percentage points since February, the biggest such fall on their records.



A majority think a trade war that triggers global recession is the biggest risk for markets, according to the survey.



U.S. President Donald Trump&#8217;s aggressive tariff plans have sparked a selloff in U.S. assets, including stocks, the dollar and Treasury bonds. The market rebounded on Monday, but the broad-market S&amp;P 500 index is still down about 8% so far this year.



BofA polled 164 investors with $386 billion of assets under management.



There were further signs of nervousness in the survey, particularly about U.S assets.



A net 42% of investors said they expected a global recession, the most since June 2023 and the fourth-highest level in the past 20 years.



In addition, 73% said they thought the theme of &#8220;U.S. exceptionalism&#8221; has peaked &#8211; the idea has powered markets in recent months &#8211; and relatedly 49% said they thought the most crowded trade in markets was now &#8220;long gold&#8221;, displacing bets on U.S. tech giants for the first time in 24 months.



A net 61% expect the U.S. dollar to depreciate over the next 12 months, the most since May 2006. The currency has tumbled sharply against most others in the past few weeks, with the euro, Japanese yen and Swiss franc all gaining sharply.



(Reporting by Alun John; Editing by Amanda Cooper and Hugh Lawson)

V6NUKK56AFOQRIE7VW57VUR2DU

Global investors dump US stocks at record pace, BofA survey says

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="768" height="402" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1CW0me.jpg" alt="" class="wp-image-609642" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1CW0me.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1CW0me-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1CW0me-160x84.jpg 160w" sizes="auto, (max-width: 768px) 100vw, 768px" /><figcaption class="wp-element-caption">A shopper at a farmer’s market in San Francisco, California, U.S., on Thursday, March 27, 2025. Bloomberg | Bloomberg | Getty Images</figcaption></figure>



A day without major tariff developments from U.S. President Donald Trump’s administration is, for markets, a period of cautious optimism (or at least what passes as “optimism” in such unusual times). There was breathing room on Monday for markets to make tentative moves upward, especially after the news out late Friday of a last-minute exception for electronics from so-called reciprocal tariffs.&nbsp; White House officials are still making their rounds on major news channels to preach the sense of Trump’s economic policy. The latest to do so is National Economic Council Director Kevin Hassett, who, on Fox Business, said Monday the country would “100% not” fall into a recession this year. Consumers don’t share that faith. A Federal Reserve survey, conducted in March and released on Monday, is the latest in a series of consumer polls that show sentiment over the economy slumping. Any gains in the market, then, could last only as far as tariff don’t run further amok and cause economic damage, despite White House officials’ attempts to reassure on the latter front.



<h2 class="wp-block-heading" id="h-what-you-need-to-know-today"><a></a>What you need to know today</h2>



Markets across the globe rise U.S. stocks rose Monday, aided by a slight recovery in tech names on news of a tariff exemption for electronic goods. The S&amp;P 500 added 0.79%, the Dow Jones Industrial Average climbed 0.78% and the Nasdaq Composite advanced 0.64%. Asia-Pacific markets were mostly positive Tuesday. India’s Nifty 50 popped more than 2% at its open. Market watchers are awaiting the country’s March inflation figures, out later today. China’s CSI 300 fell around 0.3% amid UBS downgrading its forecast of the country’s 2025 economic growth.



Hassett says no chance of recession U.S. National Economic Council Director Kevin Hassett said Monday that “more than 10” countries had made “very good, amazing” trade deal offers to the U.S. He also said that there was no chance at all that the U.S. will experience a recession in 2025. A Federal Reserve Bank of New York survey released the same day — but conducted before April 2 — showed consumer worries in March growing over inflation, unemployment and the stock market.



Volatility from zero-day options Zero-day-to-expiration options are partly to blame for the wild swings in the stock market recently. Zero-day options, which are contracts that expire the same day they’re traded, have surged 23% in trading volume from the start of the year to April, according to JPMorgan data. “We find that 0DTE (+1DTE) have been instrumental in driving more intraday volatility, Maxwell Grinacoff, UBS’ head of U.S. equity derivatives research, said in a note.



Nvidia to build supercomputer in U.S. Nvidia said Monday it plans to produce up to $500 billion of artificial intelligence infrastructure in the U.S. via its manufacturing partnerships over the next four years. Its Blackwell AI chips have started production in Phoenix at Taiwan Semiconductor plants, the chipmaker wrote in a blog post. Nvidia is also building manufacturing plants in Texas to produce AI super computers — the first time Nvidia will make one entirely in the U.S.



Semiconductor support package amid probe South Korea on Tuesday announced a support package of 33 trillion won ($23.25 billion) for its semiconductor industry. That amount is about a quarter more than the 26 trillion won committed last year, according to a press release from the finance ministry, possibly in response to U.S. trade policy. The U.S. Commerce Department is conducting a national security investigation into imports of semiconductor technology and related downstream products, according to a Federal Register notice put online Monday. 



‘Prepare to be fooled’ on tariffs: Morgan Stanley Despite recent concessions on tariffs by Trump, Morgan Stanley cautioned investors not to let their guard down. “Investors should prepare to be fooled many more times,” the firm’s strategists led by Matthew Hornbach said in a note to clients titled “Fool Me Once, Shame On You. Fool Me Twice, Shame On Me.”



<h2 class="wp-block-heading" id="h-and-finally"><a></a>And finally&#8230;</h2>



<figure class="wp-block-image"><img decoding="async" src="https://image.cnbcfm.com/api/v1/image/108131519-1744643962951-gettyimages-2209073831-ECP_fc1250932.jpeg?v=1744678236&amp;w=1858&amp;h=1045&amp;vtcrop=y" alt="HANGZHOU, CHINA - APRIL 11 2025: A worker rests in a factory making steel bike rims for export to the U.S. in Hangzhou in east China's Zhejiang province Friday, April 11, 2025. (Photo credit should read Feature China/Future Publishing via Getty Images)"/><figcaption class="wp-element-caption">A worker rests in a factory making steel bike rims for export to the U.S. in Hangzhou in east China’s Zhejiang province Friday, April 11, 2025.  Feature China | Future Publishing | Getty Images</figcaption></figure>



If China is going to lose some manufacturing as a result of&nbsp; Trump’s tariffs, the U.S. manufacturing sector won’t be the main beneficiary, according to a new CNBC Supply Chain Survey. The Trump administration says a reshoring boom is coming, but most companies tell CNBC that the costs could as much as double to bring supply chains back and instead a new search for low-tariff regimes around the world will commence.



Nearly three-quarters of those surveyed (74%) said cost was the top reason for saying they would not be reshoring production, followed by the challenge of finding skilled labor (21%). The Trump administration has promised&nbsp;tax cuts for companies&nbsp;that bring back manufacturing, but the survey found taxes lower in the ranking of costs that impact manufacturing site decision making.

AA1CW0me

Consumers don’t agree with the White House that the economy will be fine

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/06/107241090-1684160036619-gettyimages-1255019394-AFP_33F44YL-820x547.jpeg" alt="" class="wp-image-425198" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/06/107241090-1684160036619-gettyimages-1255019394-AFP_33F44YL-820x547.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/107241090-1684160036619-gettyimages-1255019394-AFP_33F44YL-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/107241090-1684160036619-gettyimages-1255019394-AFP_33F44YL-135x90.jpeg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/107241090-1684160036619-gettyimages-1255019394-AFP_33F44YL-768x512.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/107241090-1684160036619-gettyimages-1255019394-AFP_33F44YL-1536x1024.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/107241090-1684160036619-gettyimages-1255019394-AFP_33F44YL-scaled.jpeg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Elon Musk is the wealthiest person in the world again.
Michel Euler | AFP | Getty Images</figcaption></figure>



MASERU, (Reuters) &#8211; Lesotho has granted a licence to Elon Musk&#8217;s Starlink to operate a satellite network and provide satellite internet services, the country&#8217;s communications authority said on Monday.



The licence granted to Starlink Lesotho will be valid for 10 years, Lesotho Communications Authority (LCA) said in a statement.



The development comes as Lesotho seeks to engage with the United States on reciprocal trade tariffs after it was hit with a 50% tariff- the highest levy on U.S. President Donald Trump&#8217;s list of target economies announced earlier this month but later said would temporarily be lowered.



The LCA said the &#8220;landmark decision&#8221; to grant a licence to Starlink marked &#8220;a significant step forward in the country&#8217;s digital transformation&#8221; and that it underscored &#8220;the authority&#8217;s unwavering commitment to enabling a competitive, transparent, and forward-looking communications sector that fuels economic growth and fosters innovation.&#8221;



Trump on March 5, in an address to the U.S. Congress referred to Lesotho as a country &#8220;no one has heard of&#8221; to laughs from his audience. Lesotho&#8217;s foreign minister, Lejone Mpotjoane, later said the remark was &#8220;quite insulting&#8221;.



Starlink, whose parent company is SpaceX, submitted its licence application in April 2024 but it faced opposition including from civil society groups such as SECTION 2.



&#8220;By proceeding with this decision, the LCA has not only disregarded the valid objections of local stakeholders but has also compromised the integrity and credibility of the regulatory process,&#8221; said SECTION 2 coordinator Kananelo Boloetse.



&#8220;Chief among these (objections) was the fact that Starlink Lesotho is 100% foreign-owned, a factor that should have weighed heavily in a licensing process that ought to safeguard national interests and promote inclusive local participation.&#8221;



Starlink operates in many African countries, but has faced licensing obstacles in places like South Africa and Namibia.



(Reporting by Marafaele Mohloboli; Writing by Olivia Kumwenda-Mtambo; Editing by Susan Fenton)

featured

World Bank urged to reduce equity-to-loan ratio to free up funds for poor countries

IMF slashes UK’s growth forecast, points to U.S. tariffs and borrowing costs

Malnutrition treatments halted in Ethiopia due to underfunding, WFP says

Investors grow wary of U.S. assets as Trump intensifies attacks on Powell

As the dollar falters, the world’s central banks tread a tightrope — devalue their currency or not

Nigeria cuts electricity subsidies by 35% after tariff hike

South Africa finance minister says dropping VAT hike would have severe consequences

Nigeria signs minerals pact with South Africa in diversification push

South African rand weaker as markets await tariff, local government news

China targets U.S. services and other areas as it decries ‘meaningless’ tariff hikes on goods

Global trade outlook has ‘deteriorated sharply’ amid Trump tariff uncertainty, WTO warns

PwC shuts operations in nine African countries

UK inflation slows to cooler-than-expected 2.6% in March

Nigeria’s annual inflation picks up to 24.23% in March

Global investors dump US stocks at record pace, BofA survey says

Consumers don’t agree with the White House that the economy will be fine

Lesotho grants operating licence to Musk’s Starlink

News Tips

Advertise With Us

featured

World Bank urged to reduce equity-to-loan ratio to free up funds for poor countries

IMF slashes UK’s growth forecast, points to U.S. tariffs and borrowing costs

Malnutrition treatments halted in Ethiopia due to underfunding, WFP says

Investors grow wary of U.S. assets as Trump intensifies attacks on Powell

As the dollar falters, the world’s central banks tread a tightrope — devalue their currency or not

Nigeria cuts electricity subsidies by 35% after tariff hike

South Africa finance minister says dropping VAT hike would have severe consequences

Nigeria signs minerals pact with South Africa in diversification push

South African rand weaker as markets await tariff, local government news

China targets U.S. services and other areas as it decries ‘meaningless’ tariff hikes on goods

Global trade outlook has ‘deteriorated sharply’ amid Trump tariff uncertainty, WTO warns

PwC shuts operations in nine African countries

UK inflation slows to cooler-than-expected 2.6% in March

Nigeria’s annual inflation picks up to 24.23% in March

Global investors dump US stocks at record pace, BofA survey says

Consumers don’t agree with the White House that the economy will be fine

Lesotho grants operating licence to Musk’s Starlink

News Tips

Advertise With Us

Newsletters