{"id":3460,"date":"2020-05-26T00:00:00","date_gmt":"2020-05-26T00:00:00","guid":{"rendered":"https:\/\/staging.azafinance.com\/2020\/05\/26\/nigeria-mpc-scope-limited-risk-on-rand-belies-realities-multilateral-boost-to-kenya\/"},"modified":"2020-05-26T00:00:00","modified_gmt":"2020-05-26T00:00:00","slug":"nigeria-mpc-scope-limited-risk-on-rand-belies-realities-multilateral-boost-to-kenya","status":"publish","type":"post","link":"https:\/\/azafinance.com\/nigeria-mpc-scope-limited-risk-on-rand-belies-realities-multilateral-boost-to-kenya\/","title":{"rendered":"Nigeria MPC scope limited; risk-on Rand belies realities; multilateral boost to Kenya","gt_translate_keys":[{"key":"rendered","format":"text"}]},"content":{"rendered":"\n<h2 class=\"wp-block-heading\"><strong>MPC scope limited in face of Nigeria contraction<\/strong><\/h2>\n\n\n\n<p>After a week of pressure on the Naira in which the CBN had to inject up to $100 million to offset selling, all eyes turn to the <strong>MPC<\/strong> this week as it responds to <strong>official projections for up to 8.9% economic contraction as a result of coronavirus lockdowns and low oil prices<\/strong>. Despite the need for monetary stimulus, <strong>the MPC<\/strong> <strong>must keep<\/strong> <strong>rates steady<\/strong> to cushion the currency from further depreciation after weakening to 460 on the parallel market last week. Inflation climbed to 12.34%. We still foresee sustained pressure on the Naira in the coming days.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Risk-on Rand belies coronavirus realities<\/strong><\/h2>\n\n\n\n<p>The Rand strengthened as the South African Reserve Bank lowered its policy rate by 50 bps \u2013 less than the 100 bps many had expected \u2013 in a bid to boost recovery of the economy. <strong>The Rand has been recovering, climbing to 17.60 per dollar from 18.59 last week<\/strong>, with the global easing of lockdowns improving investors\u2019 risk appetite. However, for as long as South Africa grapples with a rise in coronavirus cases, now at over 18,000, we are braced for continued volatility.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Multilateral boost to Kenya reserves sustains Shilling<\/strong><\/h2>\n\n\n\n<p>The mood music has shifted again in Washington to help Kenya\u2019s economy and the Shilling. Little over a week ago, the IMF increased the nation\u2019s risk of debt distress from moderate to high, cautioning that COVID-19 fiscal stimulus measures left Kenya more challenged. Yet, last week the IMF disbursed $739 million, lifting the nation\u2019s dollar reserves to the equivalent of 5.2 months of import cover and providing potential support for the Shilling against depreciation pressure. On top of that, the World Bank, citing Kenya\u2019s \u201cinclusive growth agenda,\u201d approved\u00a0$1 billion to help close the country\u2019s budget deficit, which has increased to 8.2% of GDP from 7% in the previous fiscal year. <strong>The multilateral assistance will sustain the currency\u2019s current level of around 107 per dollar<\/strong>.<\/p>\n\n\n\n<p>Read more here: <a href=\"https:\/\/azafinance.com\/increased-pressure-on-african-currencies-amidst-covid-19-chaos\/\" target=\"_blank\" rel=\"noreferrer noopener\">Pressure on African Currencies Amidst COVID-19<\/a><\/p>\n","protected":false,"gt_translate_keys":[{"key":"rendered","format":"html"}]},"excerpt":{"rendered":"<p>MPC scope limited in face of Nigeria contraction After a week of pressure on the Naira in which the CBN had to inject up to $100 million to offset selling, all eyes turn to the MPC this week as it responds to official projections for up to 8.9% economic contraction as a result of coronavirus [&hellip;]<\/p>\n","protected":false,"gt_translate_keys":[{"key":"rendered","format":"html"}]},"author":1,"featured_media":3461,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[19],"tags":[204,205,206,207,191,192,193],"class_list":["post-3460","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-fx-insights","tag-african-currencies","tag-african-currencies-forex","tag-african-currencies-naira","tag-african-currencies-vs-dollar","tag-currency","tag-rand","tag-shilling"],"acf":[],"gt_translate_keys":[{"key":"link","format":"url"}],"_links":{"self":[{"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/posts\/3460","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/comments?post=3460"}],"version-history":[{"count":0,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/posts\/3460\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/media\/3461"}],"wp:attachment":[{"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/media?parent=3460"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/categories?post=3460"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/azafinance.com\/wp-json\/wp\/v2\/tags?post=3460"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}