Global Economy

U.S.A: U.S. consumer prices increased at a moderate pace in February, offering some relief to inflationary pressures. The Consumer Price Index (CPI) rose by 0.2% for the month, down from January’s 0.5% gain. On an annual basis, headline inflation stood at 2.8%, while core CPI, which excludes food and energy, advanced 3.1% y/y. The slowdown was primarily driven by a 4.0% drop in airline fares and lower gasoline prices, which fell by 1.0%. However, shelter costs continued their upward trajectory, rising 0.3% for the month. Egg prices surged 10.4% due to supply disruptions from an avian flu outbreak, with an annual increase of 58.8%—a key point of economic concern. Despite the softer inflation reading, analysts caution that the effects of newly implemented tariffs may not yet be fully reflected in the data.

Sub-Saharan African Economies

China: China’s consumer inflation entered negative territory in February for the first time in over a year, signaling ongoing deflationary pressures in the world’s second-largest economy. The Consumer Price Index (CPI) declined by 0.7% y/y, missing expectations of a 0.5% drop and reversing January’s 0.5% increase. On a m/m basis, CPI fell 0.2%, contrasting with the 0.7% rise in the previous month. The decline was primarily driven by falling prices in food, tobacco, and alcohol, highlighting weak domestic demand despite Beijing’s stimulus measures. This trend raises concerns about China’s ability to achieve its 2025 GDP growth target of around 5%, particularly as trade tensions with the U.S. escalate. In response, the Chinese government has lowered its annual consumer inflation target to “around 2%,” marking the lowest level in over two decades.

Angola: Angola’s annual inflation rate eased for the seventh straight month to 25.26% in February 2025, supported by kwanza stability. On a monthly basis, consumer prices rose 1.59%, with slower increases in key categories like food, beverages, and services. Meanwhile, Q4 2024 GDP grew 3.6%, driven by a 62.4% surge in diamond and mineral extraction, alongside gains in telecoms, public administration, and utilities. However, finance and oil & gas sectors weakened. For 2024, GDP expanded 4.4%, the strongest growth since 2014 (4.8%).

Senegal: Senegal’s annual inflation rate slowed to 0.6% in February 2025, down from 1.8% in January, driven by weaker price increases in food, housing, health, and hospitality. Meanwhile, transport and alcohol prices rose, while personal care costs rebounded. On a monthly basis, consumer prices fell 0.6%, reversing January’s 1.1% increase.

Rwanda: Rwanda’s inflation rate slowed to 3.8% in February 2025, down from 5.7% in January, driven by lower food prices, particularly a 4.9% drop in vegetable costs. Price growth also eased across housing, health, recreation, and transport. On a monthly basis, inflation rose 0.9%, rebounding from a 1.6% decline in January.

Domestic Economy

Major updates during the week:

  • Nigeria’s House of Representatives passed four key tax reform bills, maintaining VAT at 7.5%, revising the VAT sharing formula, and establishing the Nigeria Revenue Service to enhance revenue generation, fiscal transparency, and tax fairness for low-income earners and businesses.
  • Nigeria’s PMI rose to 51.4 in February 2025, signalling private sector growth driven by agriculture and services, while industrial activity declined; strong demand and lower energy costs supported business conditions.
  • Nigeria’s House of Representatives passed the Insurance Industry Reform Act 2024, setting higher capital requirements for insurers and proposing penalties for unlicensed operators

Nigerian equity market: NGX extends losing streak

The Nigerian equities market closed bearish for the third consecutive week as sustained sell pressure and profit-taking dampened investor sentiment. The NGX All-Share Index declined by 0.55% to 105,995.32 points from the previous week’s 106,538.60 points. Market breadth remained negative, with 46 losers outweighing 38 gainers. Declines in CONOIL (-10.00%), VFD (-9.92%), MTNN (-4.22%), OANDO (-7.14%), and UBA (-3.56%) drove the downturn, despite gains in INTBREW (+5.77%), GTCO (+2.52%), ETERNA (+11.27%), and TRANSCORP (+8.74%). Sectoral performance was weak, as three out of five sectors closed in the red, with the Insurance sector leading the gainers, edging higher by 0.89% WoW.

Nigerian fixed-income market: Selling pressure drives yield higher.

This week’s treasury bills auction saw the Debt Management Office (DMO) sell ₦678 billion, despite total bids reaching ₦1.2 trillion. However, yields on the 1-year maturity rose to 18.39% from 17.82% in the previous auction, driven largely by pre-auction selling pressure. A similar trend was observed in the secondary market, where the average yield increased by 7 basis points to 19.17%.In the bond market, activity remained subdued, with the average yield holding steady at 18.46% at the close of the week. Nonetheless, there was some buying interest in short-tenor bonds. Meanwhile, Nigeria’s Eurobond market ended the week on a negative note, as yields climbed 16 basis points week-on-week. Looking ahead, we anticipate a mixed sentiment in the coming trading week as investors continue to assess key market-moving data.