India can achieve growth of up to 8%

India can achieve growth of up to 8%, central bank chief says

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1317" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/R5IFRXYGKRJAJJVUQVPJG5LLYI-scaled.jpg" alt="" class="wp-image-532488" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/R5IFRXYGKRJAJJVUQVPJG5LLYI-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/R5IFRXYGKRJAJJVUQVPJG5LLYI-300x193.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/R5IFRXYGKRJAJJVUQVPJG5LLYI-820x527.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/R5IFRXYGKRJAJJVUQVPJG5LLYI-140x90.jpg 140w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/R5IFRXYGKRJAJJVUQVPJG5LLYI-768x494.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/R5IFRXYGKRJAJJVUQVPJG5LLYI-1536x988.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">FILE PHOTO: A man cycles past a chimney giving off emissions in an industrial area of Singapore January 5, 2016. REUTERS/Tim Wimborne/File Photo</figcaption></figure>



SINGAPORE, Sept 19 (Reuters)&nbsp;&#8211;&nbsp;Singapore&#8217;s low carbon, state-backed investment firm GenZero will collaborate with Rwanda on projects to generate carbon credits to offset emissions, it said on Thursday.



Countries such as Australia and Britain have ruled out the use of offsets, which have been widely criticised, to meet their net zero targets, but Singapore is relying on them because the city state lacks the space to build large-scale renewable projects.



The deal, signed by GenZero, the Rwanda Green Fund and carbon certification body Gold Standard that pledges to ensure project integrity, falls under Article 6 of the Paris Agreement on climate change.



The clause sets out ways for countries to meet climate targets by investing in low-carbon projects in other nations, either through bilateral arrangements or a yet-to-be finalised U.N. trading scheme.



&#8220;We will review potential projects with the Rwandan Green Fund and the Rwanda Environment Management Authority over the coming months, to determine their eligibility and suitability to be included in the collaboration,&#8221; Frederick Teo, chief executive of GenZero, an arm of the state investment fund Temasek, said.



&#8220;Projects can be nature-based solutions such as nature restoration, or technology-based solutions such as improved waste management.&#8221;



Though Article 6 negotiations are ongoing, Singapore has signed memoranda of understanding with Laos and the Philippines as well as legally binding &#8220;implementation agreements&#8221; with Ghana and Papua New Guinea.



Negotiations have also been completed on pacts with Bhutan, Paraguay and Vietnam, Ravi Menon, Singapore&#8217;s Ambassador for Climate Action, told a conference last week.



Singapore firms can offset up to 5% of taxable carbon emissions by buying credits through Article 6 deals.



Article 6 will be a priority during COP29 climate talks in Azerbaijan in November after negotiations on a final text broke down in Dubai last year.



Parties have struggled to reach consensus on how a U.N.-run carbon market should operate and some worry that bilateral agreements could impact national sovereignty.



(Reporting by David Stanway; editing by Barbara Lewis)

FILE PHOTO: A man cycles past a chimney giving off emissions in an industrial area of Singapore

Singapore’s GenZero to work with Rwanda on carbon offset projects

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-820x547.jpg" alt="" class="wp-image-506008" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-1536x1025.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Ugandan shilling and US dollars in the draw at a foreign exchange currency bureau in Kampala, Uganda, on Wednesday, Aug. 16, 2023. Uganda&#8217;s central bank said it stands ready to act if the World Bank&#8217;s decision to halt new funding over the country&#8217;s passage of anti-LGBTQ legislation impacts the currency further. Photographer: Luke Dray/Bloomberg via Getty Images</figcaption></figure>



KAMPALA, Sept 19 (Reuters) &#8211; The Ugandan shilling was firmer on Thursday, underpinned by inflows of dollars from commodity exporters and remittances, traders said.



At 0853 GMT, commercial banks quoted the shilling at 3,709/3,719, compared with Wednesday&#8217;s closing rate of 3,715/3,725.



(Reporting by Elias Biryabarema; Editing by George Obulutsa)

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<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1427" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PHZVFDZVK5KOFC5CAW3CU3SPAI-scaled.jpg" alt="" class="wp-image-532434" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PHZVFDZVK5KOFC5CAW3CU3SPAI-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PHZVFDZVK5KOFC5CAW3CU3SPAI-300x209.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PHZVFDZVK5KOFC5CAW3CU3SPAI-820x572.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PHZVFDZVK5KOFC5CAW3CU3SPAI-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PHZVFDZVK5KOFC5CAW3CU3SPAI-768x535.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PHZVFDZVK5KOFC5CAW3CU3SPAI-1536x1071.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">A vendor shows a ten Zimbabwe gold-backed (ZiG) note along a street in Harare, Zimbabwe, July 17, 2024. REUTERS/Philimon Bulawayo</figcaption></figure>



HARARE, Sept 19 (Reuters)&nbsp;&#8211;&nbsp;Five months after its launch, Zimbabwe&#8217;s new currency is under pressure as increased grain imports eat away at foreign reserves, putting at risk the government&#8217;s plan to make it the only currency in the market by 2026.



The gold-backed ZiG, which stands for Zimbabwe Gold, is the country&#8217;s sixth attempt at a stable currency in 15 years. It was introduced in April at a rate of 13.6 ZiG per U.S. dollar and has since lost almost 80% of its value on the black market.



Independent economist Prosper Chitambara said the devaluation pointed to a lack of confidence in the new currency, that locals have been reluctant to embrace.



Persistence Gwanyanya, a member of the Reserve Bank of Zimbabwe&#8217;s Monetary Policy Committee, told Reuters that although uptake had been slow, it was too soon to consider the new currency a failure.



Gwanyanya said the government could increase use of the ZiG by charging more taxes in the local currency. &#8220;Government more than any other should show preference for its own currency and there is need for urgent intervention by injecting more foreign currency on the market,&#8221; he said.



But market traders are not convinced.



&#8220;The ZiG has been getting weaker so it does not make business sense to transact with it. I do not have faith in the ZiG. We have been here before with the Zimdollar,&#8221; Maynard Maketo, a street hawker selling candy and recharge cards said.



According to Pricecheck, a website that tracks the exchange rate, the ZiG is trading between 20 ZiG and 26 ZiG to $1 on the black market and 13.9 ZiG to $1 on the official exchange.



Carol Munjoma, a trader in downtown Harare who sells groceries, transacts exclusively in U.S dollars.



&#8220;Where I buy these groceries, they do not accept ZiG. So to protect my business I charge in U.S dollars. The ZiG would have to be stable to be accepted here,&#8221; the mother of two said.



In July, central bank chief John Mushayavanhu told Reuters that authorities would stick to promises to build trust in the new currency, a sentiment echoed by Gwanyanya.



&#8220;It is too early to consider that this may be the death of the ZiG,&#8221; said Gwanyanya.



(Reporting by Nyasha Chingono; editing by Kopano Gumbi and Christina Fincher)

A vendor shows a ten Zimbabwe gold-backed (ZiG) note along a street in Harare

Zimbabwe’s new currency faces headwinds five months on

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="429" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-820x429.jpg" alt="" class="wp-image-519304" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-820x429.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-160x84.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-768x402.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-1536x804.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A teller counts Kenya shilling notes inside the cashier&#8217;s booth at a forex exchange bureau in Kenya&#8217;s capital Nairobi, April 20, 2016. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, Sept 19 (Reuters) &#8211; Kenya&#8217;s shilling was unchanged against the U.S. dollar on Thursday, data from the London Stock Exchange Group showed.



At 0748 GMT, the shilling traded at 128.50/129.50 per dollar, the same as Wednesday&#8217;s closing rate.



(Reporting by George Obulutsa; Editing by Alexander Winning)

LYEEWJTJKRPK3GJPCKWFP3EK7E

Kenyan shilling stable, LSEG data shows

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-820x547.jpg" alt="" class="wp-image-505638" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-768x513.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-1536x1025.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A South African one rand coin sits on South African rand banknotes in this arranged photograph in Pretoria, South Africa, on Wednesday, Aug. 14, 2019. The rand ended a tumultuous week on a positive note, gaining against the dollar for a second day and heading for its first weekly advance in four as technical indicators suggested recent declines are overdone. Photographer: Waldo Swiegers/Bloomberg via Getty Images</figcaption></figure>



JOHANNESBURG, Sept 19 (Reuters)&nbsp;&#8211;&nbsp;The South African rand gained in early trade on Thursday after a super-sized interest rate cut by the U.S. Federal Reserve, and as local investors awaited a rate decision by the South African Reserve Bank (SARB) later in the day.



At 0735 GMT, the rand traded at 17.4650 against the dollar, about 0.4% stronger than its previous close.



The U.S. currency was down around 0.3% against a basket of peers.



The SARB is also widely expected to cut rates on Thursday in what would be its first easing step in more than four years.



Data showed on Wednesday that South Africa&#8217;s annual inflation rate fell to 4.4% last month, its lowest level since April 2021 and just below the mid-point of the SARB&#8217;s 3% to 6% target range.



Even before August&#8217;s inflation figures were released, economists polled by Reuters predicted the SARB&#8217;s repo rate would be lowered by 25 basis points (bps).



&#8220;Markets (are) expecting the central bank to cut by 25 bps. However, there are growing calls for a 50 bps cut after local inflation fell below the mid-point of the SARB&#8217;s target range and on the back of the larger Fed rate cut,&#8221; said Andre Cilliers, currency strategist at TreasuryONE.



The Fed cut interest rates by 50 bps on Wednesday, weakening the dollar and boosting the risk-sensitive rand, which hit a 14-month high after the announcement.



On the Johannesburg Stock Exchange, the Top-40 index was up about 1% in early trade.



South Africa&#8217;s benchmark 2030 government bond was little changed in early deals, with the yield at 8.83%.



(Reporting by Tannur Anders; Editing by Alexander Winning and Barbara Lewis)

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<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="408" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/istockphoto-1076949610-612x612-1-1.jpg" alt="" class="wp-image-524600" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/istockphoto-1076949610-612x612-1-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/istockphoto-1076949610-612x612-1-1-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/istockphoto-1076949610-612x612-1-1-135x90.jpg 135w" sizes="auto, (max-width: 612px) 100vw, 612px" /></figure>



JOHANNESBURG, Sept 19 (Reuters)&nbsp;&#8211;&nbsp;The following scheduled economic event, company announcement, equity and currency market moves may affect South African markets on Thursday.



<h2 class="wp-block-heading" id="h-economic-events">ECONOMIC EVENTS</h2>



The South African Reserve Bank will announce its interest rate decision.



<h2 class="wp-block-heading" id="h-companies">COMPANIES</h2>



South African insurer Discovery will report its full-year results.



<h2 class="wp-block-heading" id="h-south-african-markets">SOUTH AFRICAN MARKETS</h2>



The South African rand firmed to a near 14-month high on Wednesday ahead of the U.S. Federal Reserve&#8217;s interest rate cut and after the local inflation rate fell more than expected.



On the stock market, the Top-40 index closed 0.44% lower.



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



The U.S. dollar bounced, long-dated bond yields were up and Asian stocks rose after the Federal Reserve announced a 50 basis point rate reduction and flagged that its easing cycle would be measured.



<h2 class="wp-block-heading" id="h-wall-street">WALL STREET</h2>



U.S. stocks closed with modest losses on Wednesday, well off their intraday highs, after the Federal Reserve cut interest rates by 50 basis points, the high side of estimates for its first cut in more than four years.



<h2 class="wp-block-heading" id="h-gold">GOLD</h2>



Gold prices held steady on Thursday after hitting a record high in the previous session, following the Federal Reserve&#8217;s super-sized interest rate cut.



&#8211; &#8211; &#8211; &#8211;



Some of the main stories out in the South African press:



<h2 class="wp-block-heading" id="h-business-day">BUSINESS DAY</h2>



&#8211; Reserve Bank has ‘ample space’ to cut rates



&#8211; Consumers get relief from a drop in blackouts but battle with rising prices



(Compiled by Tannur Anders; Editing by Sumana Nandy)

istockphoto-1076949610-612×612-1

South African Markets-Factors to watch on Sept 19

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="357" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg" alt="" class="wp-image-400669" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1-300x175.jpg 300w" sizes="auto, (max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">World map with charts and graphs as symbols of global finance</figcaption></figure>



NAIROBI, Sept 19 (Reuters) &#8211; The following company announcements, scheduled economic indicators, debt and currency market moves and political events may affect African markets on Thursday.



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



The dollar bounced, long-dated bond yields were up and Asian stocks rose after the U.S. Federal Reserve announced a 50-basis-point rate cut and flagged that its easing cycle would be measured.



<h2 class="wp-block-heading" id="h-world-oil-prices">WORLD OIL PRICES</h2>



Oil prices fell in Asian trading on Thursday after a larger-than-expected Federal Reserve interest rate cut sparked concerns about the U.S. economy.



<h2 class="wp-block-heading" id="h-south-africa-markets">SOUTH AFRICA MARKETS</h2>



The South African rand firmed to a near 14-month high on Wednesday ahead of an expected U.S. Federal Reserve interest rate cut and after the local inflation rate fell more than expected.



<h2 class="wp-block-heading" id="h-kenya-markets">KENYA MARKETS</h2>



The Kenyan shilling fell against the dollar on Wednesday, data from the London Stock Exchange Group showed.



<h2 class="wp-block-heading" id="h-standard-bank-mauritius">STANDARD BANK MAURITIUS</h2>



Standard Bank, Africa&#8217;s largest bank by assets said on Wednesday it will allow small to mid-sized businesses operating on the continent to do their banking with the lender in Mauritius.



<h2 class="wp-block-heading" id="h-botswana-mining">BOTSWANA MINING</h2>



Botswana has awarded Giyani Metals a 15-year mining licence, the company announced on Wednesday, paving the way for it to become the country&#8217;s first battery-grade manganese producer.



<h2 class="wp-block-heading" id="h-ghana-economy">GHANA ECONOMY</h2>



Ghana&#8217;s economy grew by 6.9% year-on-year in the second quarter of 2024, the fastest rate in five years, boosted by expansion in several key sectors, the country&#8217;s statistics agency said on Wednesday.



((Compiled by Nairobi Newsroom))

World map with charts and graphs as symbols of global finance

African Markets – Factors to watch on Sept 19

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1600" height="900" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108036147-1726687763293-gettyimages-2172944678-_m010185_bsbvoiyl.jpeg" alt="" class="wp-image-532393" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108036147-1726687763293-gettyimages-2172944678-_m010185_bsbvoiyl.jpeg 1600w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108036147-1726687763293-gettyimages-2172944678-_m010185_bsbvoiyl-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108036147-1726687763293-gettyimages-2172944678-_m010185_bsbvoiyl-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108036147-1726687763293-gettyimages-2172944678-_m010185_bsbvoiyl-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108036147-1726687763293-gettyimages-2172944678-_m010185_bsbvoiyl-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/108036147-1726687763293-gettyimages-2172944678-_m010185_bsbvoiyl-1536x864.jpeg 1536w" sizes="auto, (max-width: 1600px) 100vw, 1600px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



WASHINGTON – The Federal Reserve on Wednesday enacted its first interest rate cut since the early days of the Covid pandemic, slicing half a percentage point off benchmark rates in an effort to head off a slowdown in the labor market.



With both the jobs picture and inflation softening, the central bank’s Federal Open Market Committee chose to lower its key overnight borrowing rate by a half percentage point, or 50 basis points, affirming market expectations that had recently shifted from an outlook for a cut half that size.



Outside of the emergency rate reductions during Covid, the last time the FOMC cut by half a point was in 2008 during the global financial crisis.



The decision lowers the federal funds rate to a range between 4.75%-5%. While the rate sets short-term borrowing costs for banks, it spills over into multiple consumer products such as mortgages, auto loans and credit cards.



In addition to this reduction, the committee indicated through its “dot plot” the equivalent of 50 more basis points of cuts by the end of the year, close to market pricing. The matrix of individual officials’ expectations pointed to another full percentage point in cuts by the end of 2025 and a half point in 2026. In all, the dot plot shows the benchmark rate coming down about 2 percentage points beyond Wednesday’s move.



“The Committee has gained greater confidence that inflation is moving sustainably toward 2 percent, and judges that the risks to achieving its employment and inflation goals are roughly in balance,” the post-meeting statement said.



The decision to ease came “in light of progress on inflation and the balance of risks.” Notably, the FOMC vote was 11-1, with Governor Michelle Bowman preferring a quarter-point move. Bowman’s dissent was the first by a Fed governor since 2005, though a number of regional presidents have cast “no” votes during the period.



“We’re trying to achieve a situation where we restore price stability without the kind of painful increase in unemployment that has come sometimes with this inflation. That’s what we’re trying to do, and I think you could take today’s action as a sign of our strong commitment to achieve that goal,” Chair Jerome Powell said at a news conference following the decision.



Trading was volatile after the decision with the Dow Jones Industrial Average jumping as much as 375 points after it was released, before easing somewhat as investors digested the news and considered what it suggests about the state of the economy.



Stocks ended slightly lower on the day while Treasury yields bounced higher.



“This is not the beginning of a series of 50 basis point cuts. The market was thinking to itself, if you go 50, another 50 has a high likelihood. But I think [Powell] really dashed that idea to some extent,” said Tom Porcelli, chief U.S. economist at PGIM Fixed Income. “It’s not that he thinks that’s not going to happen, it’s that he’s not he’s not pre-committing to that to happen. That is the right call.”



The committee noted that “job gains have slowed and the unemployment rate has moved up but remains low.” FOMC officials raised their expected unemployment rate this year to 4.4%, from the 4% projection at the last update in June, and lowered the inflation outlook to 2.3% from 2.6% previous. On core inflation, the committee took down its projection to 2.6%, a 0.2 percentage point reduction from June.



The committee expects the long-run neutral rate to be around 2.9%, a level that has drifted higher as the Fed has struggled to get inflation down to 2%.



The decision comes despite most economic indicators looking fairly solid.



Gross domestic product has been rising steadily, and the Atlanta Fed is tracking 3% growth in the third quarter based on continuing strength in consumer spending. Moreover, the Fed chose to cut even though most gauges indicate inflation well ahead of the central bank’s 2% target. The Fed’s preferred measure shows inflation running around 2.5%, well below its peak but still higher than policymakers would like.



However, Powell and other policymakers in recent days have expressed concern about the labor market. While layoffs have shown little sign of rebounding, hiring has slowed significantly. In fact, the last time the monthly hiring rate was this low – 3.5% as a share of the labor force – the unemployment rate was above 6%.



At his news conference following the July meeting, Powell remarked that a 50 basis point cut was “not something we’re thinking about right now.”



For the moment, at least, the move helps settle a contentious debate over how forceful the Fed should have been with the initial move.



However, it sets the stage for future questions over how far the central bank should go before it stops cutting. There was a wide dispersion among members for where they see rates heading in future years.



Investors’ conviction on the move vacillated in the days leading up to the meeting. Over the past week, the odds had shifted to a half-point cut, with the probability for 50 basis points at 63% just before the decision coming down, according to the CME Group’s FedWatch gauge.



The Fed last reduced rates on March 16, 2020, part of an emergency response to an economic shutdown brought about by the spread of Covid-19. It began hiking in March 2022 as inflation was climbing to its highest level in more than 40 years, and last raised rates in July 2023.&nbsp;During the tightening campaign, the Fed raised rates 75 basis points four consecutive times.



The current jobless level is 4.2%, drifting higher over the past year though still at a level that would be considered full employment.



“This was an atypical big cut,” Porceli said. “We’re not knocking on recessions’ door. This easing and this bit cut is about recalibrating policy for the fact that inflation has slowed so much.”



With the Fed at the center of the global financial universe, Wednesday’s decision likely will reverberate among other central banks, several of whom already have started cutting. The factors that drove global inflation higher were related mainly to the pandemic – crippled international supply chains, outsized demand for goods over services, and an unprecedented influx of monetary and fiscal stimulus.



The Bank of England, European Central Bank and Canada’s central bank all have cut rates recently, though others awaited the Fed’s cue.



While the Fed approved the rate cut, it left in place a program in which it is slowly reducing the size of its bond holdings. The process, nicknamed “quantitative tightening,” has brought the Fed’s balance sheet down to $7.2 trillion, a reduction of about $1.7 trillion from its peak. The Fed is allowing up to $50 billion a month in maturing Treasurys and mortgage-backed securities to roll off each month, down from the initial $95 billion when QT started.

108036147-1726687763293-gettyimages-2172944678-_m010185_bsbvoiyl

Fed slashes interest rates by a half point, an aggressive start to its first easing campaign in four years

How Fed Rate Cuts Affect The Global Economy

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PS_Indonesia-Africa-Summit-820x547.jpg" alt="" class="wp-image-532160" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PS_Indonesia-Africa-Summit-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PS_Indonesia-Africa-Summit-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PS_Indonesia-Africa-Summit-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PS_Indonesia-Africa-Summit-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PS_Indonesia-Africa-Summit-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/PS_Indonesia-Africa-Summit-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /></figure>



I recently had the honor of attending the Second Indonesia-Africa Forum, a gathering that celebrates the deep and enduring bonds between our regions and allows us to discuss, as friends and partners committed to a future of solidarity and inclusive development, the best ways in which we can chart a new course for our future cooperation.&nbsp;



We know that the potential of our regions is immense. We also know that by working together, we can achieve far more than we can alone.



The partnership between Indonesia and Africa has deep roots &#8211; It goes back to the historic 1955 Asia-Africa Conference in Bandung. That conference brought together leaders from our newly independent nations, united in their resolve to oppose colonialism, assert our sovereignty, and build a fairer world, at a time when we risked being crushed by superpower rivalry.&nbsp;



The Bandung Conference laid the foundation for the Non-Aligned Movement and later the New Asian-African Strategic Partnership (NAASP). And there is a certain symmetry between 1955 and 2024.&nbsp;



Once again, we need to join forces in order to guarantee our interests.&nbsp;



The struggle we face today is one of economic development and global influence. It is about ensuring a better quality of life for our people and being active participants in global decision-making, not merely subjects of decisions made by others. This shared objective—to create a fairer world where the voices of the Global South are respected—is central to our partnership.



The economic relationship between Indonesia and Africa has grown significantly. Trade reached USD 7.66 billion in 2016. However, this figure represents only a fraction of the potential that exists.&nbsp;



By comparison, trade between the US and China exceeds USD 600 billion annually. So clearly, there is much more that we can, and must do.



Africa is home to some of the world’s fastest-growing economies and a young population set to become the largest workforce globally by 2034.&nbsp;



Indonesia, with its strategic location, abundant natural resources, and vibrant economy, is projected to become the fourth-largest economy in the world by 2050.&nbsp;



The question we must ask ourselves is this &#8211; How can we elevate our economic partnership to new heights?



The first and most important part of the answer to this question is that we must invest in our people; they are our greatest resource and by prioritizing vocational training, higher education, and knowledge exchange programs, we can equip our young people with the skills they need to thrive in an increasingly digital and interconnected world.



In Indonesia, we have seen the transformative power of education and skills training in driving economic development &#8211; One of the flagship initiatives I proposed during the electoral campaign for President of Indonesia, which I intend to begin implementing from the moment I assume that position, is the provision of free and nutritious school lunches for Indonesian children.&nbsp;



This is not just a social and moral measure; it is above all else, a long-term investment in our people, because by ensuring that our children are well-nourished and able to focus on their studies, we can significantly improve educational outcomes and create a more skilled generation of Indonesians, those who enjoy better living standards than today.



Second, infrastructure &#8211; Investment in infrastructure, roads, ports, energy, and telecommunications, is essential to facilitate trade, attract investment, and improve the quality of life for our citizens. Indonesia’s experience in infrastructure development offers valuable lessons for all developing countries, and we are eager to share these lessons with our African partners. By working together, we can build the infrastructure needed for sustainable development and economic growth.



Here, blended finance presents a unique opportunity. By combining public and private sector funds, we can mobilize significant capital for these crucial projects.&nbsp;



Indonesia is committed to promoting blended finance initiatives to attract private investment for sustainable development projects, particularly through the G20 Bali Global Blended Finance Alliance. This alliance aims to scale blended finance for developing countries, modernize the development finance system, and foster South-South cooperation to support climate action and the Sustainable Development Goals (SDGs).



Innovation and entrepreneurship are also key drivers of economic growth. We must foster a culture of innovation and support start-ups and small businesses. By fostering innovation and creating a dynamic economic environment, we can generate jobs, boost productivity, and drive sustainable development.



Finally, we must strengthen our trade relations.&nbsp;



It is high time to expand and deepen traditional trade partnerships in areas such as mining, oil and gas, while also exploring new opportunities for cooperation in areas like the digital economy, renewable energy, and sustainable agriculture. By enhancing trade and investment flows between our regions, we can create more jobs, boost economic growth, and improve the livelihoods of our people.



As we work towards these objectives, it is important to recognize the need once again for a fair global economy, one where the concerns and needs of the Global South are respected.&nbsp;



For too long, the Global South has been marginalized in global economic decision-making, and our voices have not been adequately heard. We must advocate for reforms in international financial institutions, promote fair trade practices, and ensure that our voices are heard in global economic forums.



Additionally, we must push for reform in global governance structures, particularly the United Nations Security Council, to better represent the realities of the 21st century.&nbsp;



The current structure often sidelines the voices of the Global South, leaving our concerns underrepresented in global decision-making processes. It is time for the Security Council to include permanent seats for countries from Africa, Asia, and Latin America, ensuring that our perspectives and interests are adequately represented and fostering a more democratic and equitable global order.



Indonesia is committed to advocating for the interests of the Global South and promoting a fairer global economy. By working together, we can ensure that the concerns and necessities of our regions are respected and that we are not mere spectators in a world where decisions are often made by others without considering our interests.



The Second Indonesia-Africa Forum served as a powerful reminder of the enduring bonds that unite our regions and the immense potential for cooperation and growth.&nbsp;



Together, Indonesia and Africa can grow our weight in international relations and ensure that our voices are heard on the global stage.&nbsp;



Let us seize this moment to work together and build a brighter future for all.

PS_Indonesia-Africa Summit

Unlocking the Potential of Indonesia-Africa Relations: A Pathway to Shared Prosperity

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-820x547.jpg" alt="" class="wp-image-422955" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Uganda shillings. Uganda. (Photo by: Godong/Universal Images Group via Getty Images)</figcaption></figure>



KAMPALA, Sept 18 (Reuters) &#8211; The Ugandan shilling was marginally weaker on Wednesday, undercut by some appetite for hard currency from the manufacturing and energy sector, traders said.



At 1040 GMT commercial banks quoted the shilling at 3,715/3,725, compared to Tuesday&#8217;s close of 3,712/3,722.



(Reporting by Elias Biryabarema; Editing by Hereward Holland)

GettyImages-924883576-1

Ugandan shilling slightly weaker on importer demand

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/2Y3MQNCNXRJJDAT2KV7WMS3SLE-820x547.jpg" alt="" class="wp-image-532087" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/2Y3MQNCNXRJJDAT2KV7WMS3SLE-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/2Y3MQNCNXRJJDAT2KV7WMS3SLE-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/2Y3MQNCNXRJJDAT2KV7WMS3SLE-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/2Y3MQNCNXRJJDAT2KV7WMS3SLE-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/2Y3MQNCNXRJJDAT2KV7WMS3SLE-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/2Y3MQNCNXRJJDAT2KV7WMS3SLE-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Street view of Adum market at nightfall in Kumasi, Ghana, July 22, 2019. REUTERS/Francis Kokoroko/File Photo</figcaption></figure>



ACCRA, Sept 18 (Reuters)&nbsp;&#8211;&nbsp;Ghana&#8217;s economy grew&nbsp;by&nbsp;6.9% year-on-year in the second quarter of 2024, the fastest rate in five years, boosted by expansion in several key sectors, the country&#8217;s statistics agency said on Wednesday.



The strong growth represents a significant recovery for the producer of gold, oil and cocoa which has been grappling with its worst economic crisis in a generation due to skyrocketing public debt.



&#8220;The 6.9% growth rate is highest since the second quarter of 2019 and it was driven largely by strong expansion in the extractive sector, just as we saw in the second quarter of 2019,&#8221; government statistician Samuel Kobina Annim said.



Ghana&#8217;s overall industry sector grew by 9.3%, driven by mining and quarrying, while the gold sector expanded for the third consecutive period, by 23.6% in the quarter. The services sector grew 5.8%, while agriculture rose 5.4%, Annim said.



The cocoa sector in the world&#8217;s second biggest producer, however, contracted for the fourth consecutive quarter by 26.2%, highlighting the impact of a steady decline in crop output due to disease and poor weather.



The economic rebound is another boost to the West African state as it restructures its debt. It has invited holders of roughly $13 billion of its international bonds to swap their holdings for new instruments after reaching a preliminary restructuring agreement with two bondholder groups.



Bondholders have until Sept. 30 to accept the offer though those who agree to do so before an early deadline on Sept. 20 will be eligible for a 1% consent fee.



(Reporting by Maxwell Akalaare Adombila and Christian Akorlie; Writing by Anait Miridzhanian; Editing by Bate Felix and Keith Weir

Street view of Adum market at nightfall in Kumasi, Ghana

Ghana’s economy surges 6.9% in Q2 2024, fastest in five years

Will Taobao in English be a hit in the West?

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="521" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-820x521.jpg" alt="" class="wp-image-516586" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-820x521.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-300x191.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-142x90.jpg 142w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-768x488.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-1536x976.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A teller handles U.S. dollar banknotes and Kenya shilling banknotes inside the cashier&#8217;s booth at a forex exchange bureau in downtown Nairobi, Kenya, February 16, 2024. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, Sept 18 (Reuters) &#8211; The Kenyan shilling fell against the dollar on Wednesday, data from the London Stock Exchange Group showed.



At 0747 GMT, the shilling traded at 129.05/125.25, compared with Tuesday&#8217;s closing rate of 128.50/129.50.



(Reporting by George Obulutsa; Editing by Bate Felix)

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India can achieve growth of up to 8%, central bank chief says

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Fed slashes interest rates by a half point, an aggressive start to its first easing campaign in four years

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Ugandan shilling slightly weaker on importer demand

Ghana’s economy surges 6.9% in Q2 2024, fastest in five years

Will Taobao in English be a hit in the West?

Kenya’s shilling eases versus dollar – LSEG data

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