Ghana’s central bank will probably increase interest rates for the first time in nine months tomorrow to curb depreciation of the currency, which has fueled inflation in the world’s second-largest cocoa producer.
Kenya should tighten monetary policy in order to stem the shilling’s decline to the weakest on record and curb inflation that may quicken to 22 percent “later this year,” according to Standard Chartered Bank Plc.
Ghana will sell more longer-term debt to reduce borrowing costs after Fitch Ratings cut the nation’s credit rating yesterday and warned of risks from the public-sector wage bill and rising debt levels.
Razia Khan, an economist at Standard Chartered Plc, forecast that South Africa’s central bank will cut its benchmark interest rate by half a percentage point to 6 percent when it next meets on July 22. She had previously forecast that rates would be left unchanged.
South African Finance Minister Pravin Gordhan may target wider fiscal deficits over the next three years that will test the government’s credibility in the face of credit rating downgrades and slowing growth.
Ghana’s budget deficit may be about 5 percent of gross domestic product this year as a growing economy helps contain rising debt, said Razia Khan, head of Africa economy research at Standard Chartered Plc.