AZA Finance FX Week Ahead: Month of war in Ukraine loads pressure on Egypt, Ghana, Kenya

the invasion of Ukraine

One month on from Russia’s invasion of Ukraine, the spike in oil and commodity prices is piling pressure on import-dependent African countries. Major Ukrainian wheat importer Egypt this week devalued the Pound by 14% and increased its benchmark interest rate for the first time since 2017.

In Ghana, the Cedi nosedived to a fresh record low—taking its 2022 depreciation to 20% against the dollar—and hiked interest rates by a record 2.5 percentage points. Kenya’s Shilling tumbled to an all-time low as inflation pressure builds.

With Ghana’s bonds trading at ‘distressed’ level yields and Egypt requesting additional support from the International Monetary Fund, the crisis looks set to cause further deterioration in Africa’s international debt markets.

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Issued by AZA. This Newsletter is produced as a service to our clients. It is prepared by our dealing professionals and is based on their understanding and interpretation of market events. AZA cannot be held responsible for any losses of whatever nature sustained as a result of action taken based on comments contained in this publication.

For more information, high-resolution charts or interviews, please contact:

Gavin Serkin
[email protected]
+44 20 3478 9710

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