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In the Footsteps of Nigeria, South Africa Reappoints Apex Bank Governor

Global Market	1906 VIEWS
Global Market
1906 VIEWS

Friday, July 12, 2019 / 05:00PM / United Capital Research / Header Image Credit:IOL

Earlier this year, President Muhammadu Buhari of Nigeria re-appointed the Central Bank of Nigeria (CBN) governor Godwin Emefiele for another five-year term, following his 2nd term re-election. This singular move made history as Emefiele became the first Nigerian Apex bank governor to get a return ticket since 1999. This week, S/Africa’s President, Cyril Ramphosa, also announced the re-appointment of Lesetja Kganyago as governor of the South African Reserve Bank (SARB) for another five-year term.

Evidently, these re-appointments send a signal of relative stability in the dynamics of monetary policy of the largest economies in Africa. However, growth in the broader African economy is expected to be constrained by weaker outputs in both economies. The IMF expects aggregate regional growth to improve to 3.5% in 2019 and oscillate around 4.0% over the medium term — or about 5.0%, excluding the two major economies, Nigeria and South Africa. The Nigerian economy remains exposed to the vagaries of the Oil market while South Africa battles issues surrounding public utility and land expropriation.

The task in the hands of these 'returnees’ hinges on their ability to deploy monetary policy tools to accelerate growth in the face of weaker commodity prices. The Nigerian MPC delivered a 50bps rate cut in Mar19 with the possibility of a further cut later in the year. The SARB, on the other hand, is set to meet next week as market speculations are skewed in favour of a rate cut. In all, the need for a handshake between the fiscal and monetary policy authorities to recalibrate growth cannot be overemphasized.

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Looking Forward

Angola

Jun-19 (CPI) Inflation - July 20th

Policy Rate Decision - July 26th

Egypt

May-19 Trade Balance - July 18th

Ghana

Policy Rate Decision - July 22nd

Kenya

Policy Rate Decision - July 24th

Jul-19 (CPI) Inflation - July 31st

Morocco