Central banks in five of eight major African nations will likely hold interest rates in the next two weeks to shore up their sickly economies, even as inflation pressures build. Surging food and fuel prices from the war in Ukraine, renewed virus lockdowns in China and the US unwinding coronavirus stimulus have clouded the outlook for the continent’s post-Covid recovery.
The decision even has economists split. Absa Group Ltd analysts Ridle Markus and Samantha Singh expect the central bank to raise the benchmark interest rate by 200 basis points as they forecast inflation to exceed the MPC’s estimates after accelerating at a faster than anticipated pace in March and April. Patrick Asuming, a senior lecturer at the University of Ghana Business School, projects the MPC will leave the rate untouched to support growth after a 2.