Akintunde Oyedokun
Research Analyst
Oil prices dropped more than $1 per barrel Wednesday as uncertainty over U.S.-China trade talks and optimism around a possible Iran nuclear deal weighed on the market. Brent fell to $61.12 and WTI to $58.07.
Investors remain doubtful the upcoming trade meeting in Switzerland will yield results, while signs of progress in U.S.-Iran talks raise the chance of increased oil supply. An unexpected rise in U.S. gasoline inventories and a cautious Fed outlook also pressured prices.
Japan’s Services Rebound In April Amid Manufacturing Weakness
Japan’s services sector returned to growth in April, with the PMI rising to 52.4 from 50.0 in March, driven by improved demand and new business at the fastest pace since May 2023. This offset continued manufacturing weakness, lifting the composite PMI to 51.2. However, business confidence dipped to a three-year low amid global tariff concerns. Input costs hit a 26-month high, leading firms to raise prices, while service sector hiring rose for the 19th straight month.
Brazil Hikes Interest Rates To 14.75%, Hints At Pause Amid Inflation Concerns
Brazil’s central bank raised the Selic rate by 50 basis points to 14.75%, marking the sixth straight hike and the highest level since 2006. The move aims to tame stubborn inflation, currently at 5.49%, well above the 3% target. Policymakers emphasized maintaining a tight monetary stance for longer but signaled caution ahead, citing global uncertainties and mixed domestic signals. While future hikes aren’t ruled out, the bank left room for flexibility, with some analysts expecting a rate hold in June.
Ghana’s Inflation Falls To 21.2% In April, Still Above Target
Ghana’s consumer inflation eased to 21.2% in April from 22.4% in March, continuing a four-month downward trend, according to the statistics service. The drop was driven by a slowdown in both food and non-food prices, though food remains the main inflation driver.
Inflation remains well above the central bank’s 8% target. In March, the central bank raised rates to control rising prices, with a reassessment due in May. Finance Minister Cassiel Ato Forson projects inflation will fall to 11.9% by year-end, supported by deep spending cuts.
Nigerian Senate Approves Tax Bills, Rejects VAT Hike, Agency Funding Cuts
The Nigerian Senate has passed two key tax reform bills proposed by President Bola Tinubu, including the Nigeria Revenue Service Establishment Bill and the Joint Revenue Board Establishment Bill. The Senate rejected the proposed VAT increase from 7.5% to 10%, opting to keep the current rate and allow VAT claims on fixed assets, overheads, and administrative expenses. A 4% development levy will fund agencies, with TETFUND receiving 50%, the Nigerian Education Loan Fund 15%, NITDA and NASENI 10% each, and the National Cybersecurity Fund and Defence Security Fund 5% each. The remaining two bills, the Nigeria Tax Administration Bill and the Nigeria Tax Bill, are scheduled for review later this week, aiming to enhance Nigeria’s tax system and governance.
