Market Commentary
Oil prices slipped more than 1% on Monday as investors adopted caution ahead of a U.S. Federal Reserve policy meeting and China’s manufacturing data due this week, offsetting support from tension in the Middle East. Brent crude futures dropped 1%, or 97 cents, to $89.51 a barrel by 0718 GMT, while U.S. West Texas Intermediate crude was down 1.3%, or $1.13, at $84.41 a barrel.
KENYA: US Govt Plans to Help Boost Kenyan Investment Climate
The Biden administration has announced plans to enhance Kenya’s investment climate through the US-Kenya Strategic Trade and Investment Partnership (STIP) negotiations. Assistant US Trade Representative Constance Hamilton emphasized the importance of creating an attractive environment for multinational corporations, generating employment opportunities for Kenya’s youth, and maintaining the AGOA pact. In a related development, Kenya and Japan have initiated an Industrial Policy Dialogue to enhance economic ties and boost Kenya’s role as a reliable manufacturing partner for Japan.
NIGERIA: Nigeria’s Debt to China Increases by $800 Million in a Year
Nigeria’s debt to China rose from $3.93 billion in June 2022 to $4.73 billion in June 2023, marking an 20.36% increase. The terms of these loans have been largely kept secret by the Nigerian government, but past statements by the Debt Management Office (DMO) have provided some details. The loans are reportedly concessional, with varying interest rates between 2.5% and 3%. Despite growing concerns about loan defaults, the DMO has assured Nigerians that no national assets are collateral for these loans.
GHANA: Ghana’s Interest Rates Soar; 91-Day Treasury Bill Nears 30%
Interest rates in Ghana increased for the 35th consecutive week, with the yield on the 91-day Treasury bill nearly hitting 30%. The government recorded a 15.53% oversubscription, raising ¢2.58 billion. Rising interest rates will strain the government’s finances due to higher interest payments. The yield on the 91-day T-bill reached 29.81%, while the 182-day bill rose to 31.67%, and the 364-day bill hit 33.42%. The government accepted ¢2.50 billion of the total bids, with the 91-day bill attracting the majority of bids.
EGYPT: Central Bank of Egypt’s Gold Reserves Dip as Total Assets Shrink
The Central Bank of Egypt (CBE) saw a 2.8% decline in its gold holdings, dropping to EGP 235.64 billion ($7.64 billion) in September from EGP 242.42 billion ($7.86 billion) in August. The CBE’s total assets also decreased from EGP 4.76 trillion in August to EGP 4.62 trillion in September. In addition, CBE’s liabilities dropped from EGP 4.75 trillion in August to EGP 4.59 trillion in September. Despite the decrease in gold reserves, Egypt ranked 30th globally for gold holdings by the end of Q2 2023. Net international reserves at the CBE reached $34.97 billion in September, marking the highest level in 16 months.
TUNISIA: Tunisia Stock Market Faces Week of Decline
During the week of October 23 to 27, 2023, Tunisia’s stock market performance dipped, with the benchmark index falling by 0.1% to 8438.86 points. Modest capital volume and an annual performance of under 1% characterized the week. EURO-CYCLES stood out as a gainer, while LILAS attracted significant capital, and MAGASIN GENERAL underperformed.