Foreign exchange market

The Federal Reserve's unexpected change of tone on the evolution of its monetary policy resulted in a sharp rise in bond yields, to the detriment of equities, while benefiting the dollar. The dollar remains the main beneficiary of the new speech of the Fed. As the deadline approaches, the euro, at 1.1950 dollars, will follow more the curve of the polls and the popularity of Emmanuel Macron. Euro volatility will pick up. Investors have already started to implement hedging strategies against the fall of the European currency and the increase in its volatility in April and May. The uncertainties about the euro would benefit the yen and the Swiss franc, safe haven currencies, as well as the dollar.

Cryptocurrency

Bitcoin was once again reacting to a comment from Tesla boss Elon Musk on Twitter. The eccentric billionaire, who sent cryptocurrency prices plummeting last month by announcing that his group would no longer accept bitcoin payments, said on Sunday that he could reverse his decision when it is confirmed that miners (of bitcoin) use a reasonable amount of clean energy (about 50%). Thus, after having already climbed 9% on Sunday, bitcoin continued to rise, gaining 1.53% to $39,861.87. It went up to $41,020.30.

Money Market

As part of the recovery of its post-Covid-19 economy, Togo has raised another 27.5 billion FCFA on the regional financial market. The total amount of bids exceeded 61 billion. The auction raised 27.5 billion, representing a coverage rate of more than 245%. The operation has a maturity of 84 months, or 7 years, according to the same source, which also specifies that the securities issued carry an annual interest rate of 5.98%. Also, Côte d'Ivoire, through its simultaneous issue of Treasury bills and recovery bonds (ORD) with a maturity of 182 days and 3 years, raised an amount of 65 billion FCFA. After the auction, the UMOA-Titres agency listed 153.555 billion FCFA in overall bids from investors out of an amount put up for auction by the issuer of 65 billion FCFA. This gives a rate of coverage of the amount auctioned of 236.24%. Mali's first exit into the regional financial market since the inauguration of Assimi Goïta was a breath of fresh air, as political and security uncertainty persists. The issue of equivalent Treasury bonds enabled the country to raise 46 billion FCFA. This exit brings to 420 billion FCFA the total amount raised on the public securities market by Mali since the beginning of this year, i.e. 135 billion FCFA of assimilable Treasury bonds (maturity less than one year) and 284.8 billion FCFA of assimilable Treasury bonds (more than one year of maturity).

Stock market

The total value of transactions on the Regional Stock Exchange (BRVM) is still on the rise. It stood at 1.828 billion FCFA against 403.091 million FCFA the day before. The stock market capitalization stands at 4,828.578 billion FCFA against 4,819.392 billion FCFA previously, an increase of 59.186 billion FCFA. That of the bond market stood at 6647.752 billion FCFA against 6658.549 billion FCFA the day before, a drop of 10.797 billion FCFA.

Raw materials

Oil weakened by a perked up dollar. The strength of the dollar favors a decline in oil prices, after the highest levels in more than two years reached on Wednesday in reaction to the sharp drop in crude inventories in the United States, even if the strength of demand limits the decline.

The cocoa sector, Ghana's main export crop, is on the rise. While the country has gone through major turbulence in recent campaigns, all the indicators are in the green for the cocoa sector. According to the latest data relayed by the Ghana Cocoa Board (Cocobod), the volume of beans delivered to the Cocoa Marketing Company amounted to 924,385 tonnes as of 27 May. This is a stock up by 25% compared to that of last year at the same period (737,783 tonnes).

In Togo, the new shareholder of the New Togo Cotton Company (NSCT), Olam, has committed to producing 225,000 t of seed cotton by 2025. The country's 2020-2021 production amounted to 66,000 tons.

Companies

The group founded by the Kenyan Kennedy Njoroge and the Nigerian Bolaji Akinboro has just completed the creation of its subsidiary Cellulant Morocco in Casablanca. This is headed by Meriem Belkaid, who joined the group two years ago to prepare for this location. Cellulant has carved out a solid place for itself in the African mobile money landscape through its Tingg transaction management platform. For its part, Total Senegal experienced an increase in its operating margin, despite a drop in sales in 2020. It posted the second largest increase for a security listed on the sub-regional financial market, at the start of the week. , after the 7.5% increase posted by Crown Siem CI. This resilience was made possible by non-business elements, and the year 2021 started in difficulty. The performance follows the announcement of a dividend per share of 223.6 FCFA which will be paid on July 30 at the latest.

Banks and Insurance

The Cameroonian Head of State, Paul Biya signed a decree empowering the Minister of Economy, Alamine Ousmane Mey, to sign a credit agreement amounting to 54.1 billion FCFA with the International Development Association (IDA), one of the windows of the World Bank. This new loan from the World Bank aims to finance the country's development policies. It will contribute to increasing Cameroon's outstanding debt with the World Bank, a financial backer which is already the largest provider of financing in Cameroon at the multilateral level. The Bretton Woods institution also approved funding of $200 million to help Benin improve access to electricity services. Thus, 150,000 households, 1,000 small and medium-sized enterprises (SMEs) and 500 basic public services will be connected. This project will support the implementation of key reforms in Benin's electrification strategy, complementing the ongoing $60 million Energy Services Improvement Project. The Bank is also granting $465 million in financing to the countries of the Economic Community of West African States (ECOWAS) which will extend access to the electricity network to more than one million people, improve stability for another 3.5 million inhabitants and increase the integration of renewable energies into the West African electricity exchange system (Eeeoa). According to a World Bank press release, the new regional electricity access and battery energy storage project will increase grid connections in fragile areas of the Sahel, build the ECOWAS Regional Electricity Regulatory Authority (Arrec) and improve the operation of the WEEE network through battery energy storage infrastructure.

The West African Development Bank (BOAD) grants a loan of 30 billion FCFA to the State of Burkina Faso for the construction and asphalting of the regional road n°11 (RR11) Kolinka-Fara-Poura Carrefour in Bukina Faso. The financing of this project was approved during the 123rd session of BOAD's Board of Directors, which was held in May 2021.

At the end of the second ordinary meeting for the year 2021, the Central Bank of West African States (BCEAO) reviewed the main developments in the international and regional economic situation during the recent period, as well as the risk factors that could affect the medium-term outlook for inflation and economic growth in the Union. Examining the internal situation, the Committee noted a firming up of the recovery in economic activity in WAEMU in the first quarter of 2021, with a real GDP growth rate of 3.2%, at an annual rate, after 1.8 % in the previous quarter.

For the 2020 financial year, the International Bank for Commerce and Industry of Côte d'Ivoire (BICICI) will pay its shareholders an overall net dividend of 810 million FCFA. The announcement was made by the leaders of this banking establishment based in Abidjan. According to BICICI's Board of Directors, the resources collected by this banking establishment amounted to CFAF 716 billion, the bank's claims on its customers amounted to CFAF 482 billion, net banking income slightly fell to 45.315 billion FCFA while the gross operating result stood at 10.190 billion.

In a note on the situation, the Bank of Central African States (BEAC) notes that the total amount of new loans set up during this semester stood at 3,009 billion FCFA, down by 17.98 % compared to that of the previous half-year which was 3,668 billion and down 20.78% compared to the first half of 2019. The overall situation in the countries of the Economic and Monetary Community of Central Africa (CEMAC ) in the first half of 2020 is marked by a downward trend in the supply of credit observed since the second half of 2018, reports the Central Bank.

Governance

The assessment of the five parameters, namely: the business climate, macroeconomic performance, public finance management, the soundness of the financial system and the socio-political risk classifies Côte d'Ivoire as globally stable. The economic performance rating agency, Bloomfield investment has released its 2021 ratings on Côte d'Ivoire. Ivorian public finances were severely tested during 2020 by the negative impact of the covid-19 pandemic. The budget deficit thus worsened, going from 2.3% of GDP in 2019 to 5.6% of GDP in 2020. But, for the year 2021, the authorities anticipate an improvement in the deficit, thanks among other things pursuing the reforms initiated in public finance management.

On the side of Benin, the Minister of State in charge of development and coordination of government action, Abdoulaye Bio Tchané, is no longer Governor of the World Bank for Benin. From now on, it is his colleague from the economy and finance, Romuald Wadagni who replaces him in this post. This is the consequence of the composition of the first government of the second term of Patrice Talon at the head of Benin. Apart from the World Bank, Abdoulaye Bio Tchané leaves his place in several other financial bodies, such as the Islamic Development Bank (IDB).

Regional growth

Over the 1st quarter of 2021, WAEMU growth amounted to 3.1% at an annual rate, after 1.8% in the fourth quarter of 2020. At its meeting of the Monetary Policy Committee last week, the Central Bank of West African States (BCEAO) announces a rebound in activity which should lead to growth of 5.6% in 2021. However, the price index of the main food products imported by the countries of the union climbed 19.4% in the 1st quarter after rising 11.2% in the previous quarter. The food bill in Africa will increase dangerously.

The Mo Ibrahim Foundation recently released the report titled “A Year of COVID-19 in Africa: Impacts and Prospects” which highlights the structural vulnerabilities revealed by the pandemic and highlights the importance for the continent to define a more autonomous. The Report demonstrates in particular that the impact of the pandemic on the African continent has been particularly severe in economic and social terms, that this crisis has highlighted the structural vulnerabilities of health systems and the continent's economic growth model, and that 'we must therefore seize the opportunity to rebuild on the basis of a renovated model.

The new chairman of the Uemoa commission Abdoulaye Diop is making his first visit to Niger as well as to Togo. At the end of the talks with the Heads of State, the senior official declared that he had left to thank the presidents for having supported his appointment. This was an opportunity to say "my commitment and my availability to do everything possible to carry out the mission which is ours... We have discussed important subjects which concern the Union and the functioning of the Commission", Abdoulaye Diop.

At their summit, the G7 member countries launched a major investment plan for the benefit of the African private sector. The Development Finance Institutions (DFIs) of the G7 countries, the International Finance Corporation (IFC), the European Bank for Reconstruction and Development (EBRD), and the European Investment Bank (EIB) have announced the mobilization 80 billion to the private sector over the next five years to support economic recovery and sustainable growth in Africa.