On Wednesday, oil prices closed 3% lower, influenced by an increase in U.S. commercial inventories, weaker economic indicators from China, and progress in the United States on aid bills for Ukraine and Israel. Oil prices have eased due to economic challenges limiting gains from geopolitical tensions, while markets watch closely for Israel’s potential response to Iran’s weekend attack. Brent futures for June settled lower by $2.73, closing at $87.29 a barrel, while U.S. crude futures for May settled down $2.67, settling at $82.69 a barrel, their biggest fall since March 20.
China’s economy expanded at a pace exceeding expectations in the March quarter
China’s economy surpassed expectations in the first quarter, providing some comfort to officials as they endeavor to bolster growth amidst prolonged challenges in the property sector and increasing local government debt. The Asia’s largest economy surged by 5.3% in January-March from the year earlier, and up from the 5.2% expansion in the previous quarter. On a quarterly basis growth picked up to 1.6% from 1.4% in the previous three months. The crisis in the property sector has been a major setback on China’s economy, China’s new home prices fell at their fastest pace in more than eight years last month while Property investment fell 9.5% year-on-year in the first quarter, deepening its slump after a 9.0% drop in January-February. Sales tumbled 23.7%, compared with a 20.5% fall in the first two months of the year.
German inflation declines to its lowest level in nearly three years
Inflation in Germany softened, contributing to indications of easing price pressures in the eurozone and heightening the pressure on the European Central Bank to consider interest rate cuts. Inflation in Europe’s largest economy softened to 2.3% ,the lowest level since June 2021;driven majorly by lower food and energy prices. However in February, German consumer prices, adjusted to facilitate comparison with other European Union countries, increased by 2.7% year-on-year. Core inflation in Germany, which excludes volatile food and energy prices, was at 3.3% in March, down from 3.4% in February. Inflation in Germany is bolstered by an upward trajectory in service prices, driven primarily by a significant surge in wage expenses, alongside an increase in rental costs.
South Africa: Inflation decelerates, rate cut yet to be implemented
South Africa’s consumer inflation fell marginally more than expected in March, Headline inflation fell to 5.3% year on year from 5.6% recorded in February. The South African Reserve Bank (SARB) has maintained its primary interest rate at 8.25% at its last five monetary policy meetings, reiterating last month’s statement that it must maintain a restrictive stance( Hawkish). However, It expects headline inflation to reach 4.5%, the midpoint of its target range, only near the end of 2025. On a month-on-month basis, consumer inflation was at 0.8% in March compared to 1.0% a month before, while core inflation came in at 4.9% from 5.0% in February. Additionally, the rand strengthened against the USD after Wednesday’s inflation data and was last trading at 18.9500 per dollar, 0.5% stronger than its previous close.
Nigeria’s FX reserves declines by 6.27%in less than one month,
Nigeria’s foreign exchange (FX) reserves have experienced a notable decline, dropping by approximately $2.16 billion in the span of 29 days, despite the Central Bank of Nigeria’s (CBN) vigorous attempts to stabilize the naira. As of April 15, 2024, data from the CBN indicates that the FX reserves stand at $32.29 billion, marking a significant decrease from the $34.45 billion reported on March 18, 2024. Nigeria’s FX reserves plunged to its lowest level since September 25, 2017, when the reserves was $32.28 billion.
