Global Economy

US: The S&P 500 ended the week slightly higher after rebounding on Friday, lifted by Fed Chair Jerome Powell’s Jackson Hole remarks that signaled possible rate cuts. Energy, real estate, financials, and materials led sector gains, while large-cap value stocks outperformed growth. The S&P Mid-Cap 400 and Russell 2000 also advanced, but the Nasdaq slipped on profit-taking and renewed doubts over AI-driven infrastructure spending. U.S. Treasuries were flat before Powell’s comments but rallied afterward, sending yields lower.

Sub-Saharan African Economies

UK: The UK’s annual inflation rate rose to 3.8% in July 2025, the highest since January 2024, up from 3.6% in June and above expectations of 3.7%. The increase was driven mainly by transport costs, which climbed 3.2% from 1.7% in June, led by a 30.2% jump in airfares tied to summer holidays, alongside higher fuel, sea fares, and roadside recovery costs. Prices in restaurants and hotels also accelerated (3.4% vs. 2.6%), largely due to higher hotel stays, while food and non-alcoholic beverages inflation rose to 4.9% from 4.5%. The main drag came from housing and household services, where inflation eased to 6.2% from 6.7% on weaker housing costs and rents. On a monthly basis, CPI increased 0.1%, defying forecasts of a 0.1% drop but slowing from June’s 0.3% rise, while core inflation edged up to 3.8% from 3.7%

Ghana: Ghana’s producer prices rose 3.8% year-on-year in July 2025, easing significantly from historical highs. The PPI has averaged 17.19% since 2009, with a peak of 78.1% in November 2022 and a record low of 2.0% in July 2017, according to Ghana Statistical Service.

South Africa: South Africa’s inflation rose to 3.5% in July 2025, the highest in 10 months and in line with forecasts, marking a second straight monthly increase. Price pressures came mainly from food & non-alcoholic beverages (5.7% vs 5.1%), alcoholic drinks & tobacco (4.6% vs 4.4%), housing & utilities (4.3% vs 4.4%), and restaurants & hotels (3% vs 2%). Transport costs fell at a slower pace (-1.7% vs -3.3%) as fuel prices eased less sharply (-5.5% vs -11.2%). Core inflation edged up to 3.0% (from 2.9%), while monthly CPI surged 0.9%, the fastest since February, after June’s 0.3% rise

Domestic Economy

Major updates during the week:

  • Nigeria’s Q1’25 trade surplus rose on stronger export volumes, but a 0.5% dip in the Terms of Trade index (to 101.3) signaled weaker purchasing power as import prices outpaced export prices, with implications for competitiveness and FX dynamics.
  • Nigeria’s H1 2025 federal revenue hit ₦21.22trn (58.4% of target), buoyed by strong agency collections, while FX reserves rose to $41.05bn (last seen in Dec 2021) on the back of reforms, portfolio inflows, remittances, oil gains, and trade surpluses, though weak FDI and rising debt remain concerns.

Nigerian equity market: Profit taking drags the NGX lower

The Nigerian equities market closed bearish for the week, extending the prior week’s losses despite a rebound on Friday after three consecutive losing sessions. The downturn was driven by profit-taking across Industrial Goods, Insurance, Banking, and Oil & Gas sectors. Consequently, the NGX All-Share Index fell 2.51% to 141,004.14 points, while market capitalization dropped to ₦89.21trn. Market breadth was negative, with 54 decliners led by DANGCEM, BUACEMENT, STANBIC, MTNN, and GUINNESS, against 43 gainers including BETAGLAS, SFSREIT, and DANGSUGAR. Sectoral performance mirrored the overall weakness, as four of five major sectors closed bearish, with only Consumer Goods advancing (+0.83% WoW) and the Industrial Goods  index leading the sectoral laggers declining (-8.42% WoW).

Nigerian fixed-income market: Bearish sentiment prevails on higher DMO bill supply

At this week’s primary auction, the DMO sold ₦303.7 billion against the ₦230 billion on offer. Following the issuance, stop rates inched higher, with the new 1-year bill (20-August-2026) closing at 17.44% (yield: 21.12%) compared to 16.50% (yield: 19.76%) at the previous auction. This reinforced the bearish tone in the market, in line with resistance to lower yields. Consequently, the treasury bills market closed bearish, as the average yield rose by 34bps to 18.30%. A similar sentiment was observed in the bonds market, albeit at a more moderate pace, as most participants stayed on the sidelines ahead of next week’s bond auction. Nigeria’s Eurobond market also traded bearish, with average yield up 16bps. Looking ahead to next week, we anticipate renewed buying interest as investors position to take advantage of the elevated yield levels.