Global Economy

US: The U.S. annual inflation rate accelerated to 2.9% in August 2025, the highest level since January, after holding steady at 2.7% in both June and July, in line with expectations. On a monthly basis, consumer prices rose 0.4%, the largest gain since January and above the 0.3% forecast, with shelter costs (+0.4%) exerting the strongest upward pressure. The rebound in headline inflation was driven by faster price increases for food (+3.2% vs 2.9% in July), used cars and trucks (+6% vs 4.8%), and new vehicles (+0.7% vs 0.4%). Energy costs also turned positive for the first time in seven months (+0.2% vs -1.6%), as declines in gasoline (-6.6% vs -9.5%) and fuel oil (-0.5% vs -2.9%) moderated, while natural gas prices remained elevated at 13.8%.

Meanwhile, inflation steadied for transportation services (3.5%) and eased slightly for shelter on a year-on-year basis (3.6% vs 3.7%), though shelter remains the largest single contributor to overall inflation. Core inflation held firm at 3.1% year-on-year, unchanged from July and still at February’s peak, while core CPI advanced 0.3% month-on-month, matching both July’s pace and market forecasts. Overall, the August data signal that while core pressures remain stable, headline inflation is regaining momentum on the back of food, autos, and a rebound in energy, complicating the path for monetary policy.

Sub-Saharan African Economies

China: China’s consumer prices fell 0.4% year on year in August 2025, marking the fifth bout of deflation this year and the sharpest decline since February, according to the National Bureau of Statistics. The drop, steeper than market expectations of a 0.2% fall, was driven by a 4.3% plunge in food prices, the largest in nearly four years, with broad-based declines and a sharper fall in pork costs due to ample supply, lower production expenses, and subdued demand. In contrast, non-food inflation rose to 0.5% from 0.3% in July, supported by Beijing’s consumer subsidies and price gains in housing, clothing, healthcare, and education. Transport costs continued to contract but at a slower rate of 2.4%.

Angola: The annual inflation rate in Angola fell to 18.88% in August 2025 – a new low since November 2023—down from July’s 19.48%, extending the decline seen since August 2024. The relative stability of the kwanza, along with improved goods availability, has played a key role in easing inflationary pressures. Prices slowed down for most CPI items, including food & non-alcoholic beverages (19.24% vs 19.97% in July); alcoholic beverages & tobacco (20.55% vs 21.82%); clothing & footwear (19.64% vs 20.90%); health (23.69% vs 25.12%); education (9.90% vs 13.90%); restaurants & hotels (19.73% vs 21.34%) and miscellaneous goods & services (20.54% vs 20.78%). On a monthly basis, the CPI rose by 1.09% in August, after a 1.47% increase in the prior month.

Egypt: The annual urban inflation rate in Egypt slowed for the third consecutive month to 12.0% in August 2025, down from 13.9% in July, after reaching a four-month high in May due to rising fuel prices and below market forecasts of 12.7%. This marked the lowest inflation rate since March 2022, mainly driven by a sharp slowdown in food inflation, which fell to its lowest level since May 2021 (2.1% vs 3.4% in July). Price increases also moderated across several categories, including transport (26.8% vs 41.5% in July), restaurants and hotels (13.8% vs 15.2%), clothing (14.8% vs 14.9%). Meanwhile, prices accelerated for housing (16.2% vs 15.9%) and furnishings (13.4% vs 12.9%). On a monthly basis, the Consumer Price Index (CPI) rose 0.4% in August, rebounding from a 0.5% decline in July, and marking the first monthly increase in three months.

Domestic Economy

Major updates during the week:

  • NAICOM has directed all insurers to submit recapitalization plans by September 30, 2025, alongside monthly progress reports throughout the recapitalization period.
  • Nigeria’s finance minister disclosed that the 2024 budget has reached 80% implementation, while the 2025 budget is set to commence by the end of September despite lingering concerns over delays and impact.
  • CBN Governor Olayemi Cardoso urged banks to back efforts to boost diaspora remittances to $1bn monthly by 2026, up from $600m in 2024, to strengthen FX liquidity and market stability.

Nigerian equity market: NGX rebound after four weeks of losses

The Nigerian stock market closed the week bullish, breaking a four-week losing streak and pushing the NGXASI above the 140,000-point mark. The NGX All-Share Index (ASI) rose 1.13% to 140,545.69 points, compared to 138,980.01 points the prior week. Market capitalisation also increased to N88.92trn from N87.94trn, bringing year-to-date returns to 36.55%. The rebound was largely driven by bargain hunting in the banking and industrial goods sectors, with notable gains in WAPCO (+13.27%), ZENITHBANK (+4.78%), and UBA (+4.17%), offsetting declines in DANGCEM (-1.73%) and TRANSCORP (-7.24%). On a sectoral, all major indices closed positive, led by the Insurance sector, which advanced 2.45% WoW.

Nigerian fixed-income market: Nigeria’s Eurobond attracts buying interest week-on-week

The Nigerian Fixed Income Market traded positively during the week, supported by ample system liquidity that spurred demand for fixed income securities. The treasury bills segment ended on a positive note, with average yields declining by 1 basis point to 18.78%, driven by strong interest in short-term instruments. Likewise, the bond market also closed positively, as average yields fell by 27 basis points, reflecting investor preference for mid-tenor bonds. In the Eurobond space, demand strengthened across the curve, particularly for long-tenor papers on the back of global expectations of a U.S. rate cut. Looking ahead to next week, we anticipate range-bound trading in both treasury bills and bonds as investors weigh the likelihood of additional borrowings by the DMO.