Monetary policy is going to be a theme this week, especially with Central Banks across Africa positioning themselves for a U.S. rate hike in December. Given their already weak currencies, the main question is how they can best respond.
South Africa, Kenya and Ghana are all holding their MPC meetings this week, against a backdrop of expectations that the Fed will raise borrowing costs for the first time in 9 years. In Nigeria, Africa’s largest economy, the central bank will hold its final meeting of the year next week Tuesday. From Ghana to Zambia, African currencies have been among the worst hit by a slide in investor sentiment toward emerging and frontier markets as the Fed prepares to end its highly accomodative monetary policy stance. That’s spurred policy makers across the continent to tighten monetary policy to ward off inflation.
