This week's inaction from two major central banks, namely the US Federal Reserve and the Bank of Japan, has caused the global equity indices ... and the US dollar to weaken. Indeed, slower US growth than expected encouraged the Fed not to raise interest rates and to lower its expectations for any more hikes this week. It’s all about global sentiment, generally the statement that the Fed would be more cautious moving forward was supportive for African currencies.
This week’s top performers were the ZSE Ind. and the MASI. The ZSE Ind. jumped 6.56% as a surprise as Zimbabwe is facing a banking crisis. There have been serious cash shortages in Zimbabwean banks lately. This has sometimes led to banks making withdrawals restrictions to up to 200$ a day while some disconnected their ATMs. On top of that, the Reserve Bank of Zimbabwe has implemented measures to control funds transfers outside the country.
Moroccan stocks on the other hand, ended higher this week, as gains in the Construction & Building Materials, Oil & Gas and Insurance sectors led shares higher. At the close in Casablanca, the Moroccan All Shares added 4.79%.
Together with other emerging markets ‘currencies, the South African rand extended its gains against the dollar on Friday to hit a five-month high, supported by a feeble dollar on the back of disappointing inflation numbers and after a constitutional court found President Zuma liable to pay for state-funded upgrades to his private residence. On the other hand, stocks fell in line with global counterparts as earnings failed to strengthen sentiment. The JSE ASI added 0.06%.
EGX30 ended this week on negative territories. The benchmark fell 0.11%. Besides, the Central Bank of Egypt decided to keep the overnight deposit and lending rates unchanged at 10.75% and 11.75% respectively.
