AFMI Weekly Insight March 1st 2019

1 March 2019


Bonds

South Africa’s $16 million Linkers over subscribed X1.98  - South Africa sold 230 million rand ($ 16 million) of inflation-linked bonds due Dec 31, 2050. Investors offered to buy 1.98 times the amount of securities sold. The 2.5 percent bonds have a yield of 3.35 percent and will settle on March 6. The sale is a reopening of previously issued securities with ZAR 53.01 billion outstanding. (Source: Bloomberg.com/africa)

Egypt is jewel in the crown for Emerging-Market bond buyers - Local-currency notes have returned 5 percent in February, the best gain in emerging markets, according to data compiled by Bloomberg. They have also posted the best year-to-date performance, while the currency has recovered to its strongest level against the dollar in almost two years. (Source: Bloomberg.com/africa)

Kenya seeks 4.6 billion Shilling Mobile-Phone Bonds in 4 tranches - About 4.6 billion shillings will be raised in four tranches before 3-year bond program expires in 1.5 years, according to Capital Markets Authority’s Director of market operations. The 1st tranche raised 150m shillings while the2nd tranche received 247m shillings against 1b-shilling offer. Third tranche of the 3-year bond reopened Monday and seeks to raise 250m shillings, according to prospectus issued in Kenyan capital, Nairobi. Proceeds will be spent on infrastructure development. Offer starts February 25, ends March 8. Secondary trading on the securities exchange begins March 12 and will be through mobile phones. Minimum investment amount of 3,000 shillings and 140,000-shilling daily cap for individual investors. (Source: Bloomberg.com/africa)

Currency & Monetary Policy 

Botswana’s Central Bank maintains the policy rate at 5 percent - The Bank Rate was maintained at 5 percent as decided at the Monetary Policy Committee (MPC) meeting held on February 26, 2019.  The outlook for price stability remains positive as inflation is forecast to remain within the Bank’s 3 – 6 percent objective range in the medium term.  Inflation fell from 3.8 percent in November to 3.5 percent in December 2018. (Source: Bank of Botswana

Kenya’s Inflation down - Kenya’s annual inflation was down to 4.14 percent in February from 4.7 percent in January, the statistics office said. (Source: af.reuters.com

Borrowings

Kenya’s 25-year infrastructure bond to be issued this month - Kenya will sell a 25-year amortized infrastructure bond this month to raise up to 50 billion shillings ($500.25 million), the central bank said on Friday 1 March 2019. The bond, which will be auctioned on March 20, will come with a coupon of 12.20 percent, the central bank said, adding that it wiil be tax free in line with the government’s policy of encouraging investors to bank infrastructure bonds. (Source: af.reuters.com


African Domestic Bond Fund (ETF)


Currencies

Source: Bloomberg®

Currencies chart

AfDB/AFMI℠ Bloomberg® African Bond Index (ABABI) 25% Capped

The ABABI 25% Capped is a rule - based weighted composite index of local Sovereign Indices (South Africa, Egypt, Nigeria, Kenya, Namibia, Botswana, Ghana, and Zambia).

County percentage composition to the index is capped at 25 %.

To be included in the index, a security must have at least 1 year remaining to maturity.

Source: Bloomberg®

BADBC chart
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