Weekly Market Update - Monday, Aug 24, 2026

In this week's edition:

• U.S. Stocks Closed Lower Last Friday, Amid Concerns That the Treasury’s Plan to Curb Borrowing Costs May Provide Only a Short-Term Fix.
• Gold Surged 5.18% w/w, supported by renewed concerns over US fiscal sustainability.
• Ghana’s Treasury Auction Oversubscribed by 7.86% as Demand Stays Skewed to the Long End as Yields Declined.
• Broader Market Declines as GSE-CI Falls by –1.12% w/w to 72.59% YTD, GSE-FSI Also Declined by –2.36% w/w to 70.53% YTD.

 AROUND THE GLOBE   

• U.S. Fed Minutes Show Inflation Risks and Rate Hike Concerns
  • The Federal Reserve's July meeting minutes indicated that policymakers remained concerned about persistent inflation and believed additional interest rate hikes might be necessary if price pressures did not continue to moderate. While some officials felt financial conditions were not restrictive enough, others argued that tighter market conditions were already helping to curb demand. Overall, inflation risks were viewed as skewed to the upside, although the minutes may reflect a more hawkish stance than current market expectations, as they preceded softer employment and inflation data released subsequently.
• U.S. Factory Growth Slows to 5-Month Low: S&P Global
  • US manufacturing activity moderated in August 2026, with the S&P Global US Manufacturing PMI declining to 53.2 from 53.9 in July, below market expectations. The slowdown reflected higher fuel costs, reduced inventory accumulation, and raw material shortages caused by supply chain delays. Output growth weakened for the third consecutive month, while new orders expanded at their slowest pace since March. Input purchasing contracted for the first time since February, and supplier delivery times lengthened further. Despite these challenges, employment growth strengthened, price pressures eased somewhat, and business confidence improved.
• European Investor Morale Stronger than Anticipated
  • Eurozone economic sentiment improved for a third consecutive month in August 2026, with the ZEW Economic Sentiment Indicator rising to 31.4, its highest level in six months and above market expectations. The improvement reflected growing optimism among analysts, with over a third expecting economic conditions to strengthen and only a small minority anticipating deterioration. The assessment of current economic conditions also improved significantly, while inflation expectations eased, suggesting a more favourable outlook for growth and price stability in the region.
• UK Private Sector Activity Unexpectedly Accelerates
  • UK private sector activity remained resilient in August 2026, with the S&P Global UK Composite PMI holding at 52.5, outperforming market expectations. Growth was driven by stronger services activity, which offset a slowdown in manufacturing. New orders increased at the fastest pace since February, supported by robust demand in the services sector. However, employment continued to decline amid higher labour costs, while rising fuel prices and wages contributed to renewed inflationary pressures. Despite these challenges, business confidence improved for a third consecutive month, aided by better profit margins following the stabilisation of energy prices.

GHANA

• Bank of Ghana Holds Firm on 8% Inflation Target as Geopolitical Risks Cloud Outlook 

• • The Bank of Ghana is resisting calls to lower its medium-term inflation target despite a sharp improvement in price stability, signalling that policymakers are unwilling to declare victory while geopolitical tensions and external shocks could still disrupt Ghana’s macroeconomic recovery. The position reflects a deliberately cautious monetary-policy stance after Ghana emerged from one of its most severe inflationary episodes in decades, when rapid price increases, exchange-rate depreciation and fiscal pressures sharply weakened household purchasing power and business confidence.
• Bank Energy Sector Reset Cuts $1.47bn Burden
  
  
  • Ghana’s attempt to repair the finances of its power industry is beginning to produce measurable fiscal gains, with the government clearing about US$1.47 billion in legacy energy-sector obligations while securing an estimated US$750 million in savings from cheaper fuel choices and renegotiated power agreements. Speaking at a press briefing, the energy minister stated that reforms spanning fuel substitution, debt restructuring and tighter management of electricity-sector revenues had improved payments to Independent Power Producers and reduced the pace at which new arrears accumulate.

AFRICA

• Nigeria’s Inflation Rate Slows to 4-Month Low in July
  • Nigeria’s annual inflation rate slowed for the second consecutive month to 15.43% in July 2026, its lowest level since March, supported by the relative stability of the naira. The decline was driven by softer price increases in categories such as transportation, clothing and footwear, restaurants and hotels, and miscellaneous goods and services. However, food inflation accelerated to 20.31%, marking its sixth consecutive monthly increase and remaining the key inflationary pressure.
• Egypt's Central Bank Maintains Key Policy Rate
  • The Central Bank of Egypt maintained its benchmark interest rate at 19% in August 2026, marking the fifth consecutive meeting without a rate change as policymakers balanced inflation risks against moderating economic growth. The decision reflects concerns over rising inflation, pressure on the Egyptian pound, and higher fuel import costs stemming from regional geopolitical tensions. While economic activity softened in the second quarter, the central bank expects growth to average around 5% in FY2025/26 and inflation to gradually return to its target range by the second half of 2027. Policymakers reiterated their commitment to price stability, with markets expecting rates to remain unchanged through the end of 2026 before easing resumes in early 2027.
• South Africa Building Permits Jump in June
  • Building plans approved in South Africa surged by 30.5% from a year ago to around 9,868 in June 2026, following a revised 12.9% slump in the previous month. This was the strongest increase since January 2025, underpinned by a strong recovery in plans approved for non-residential buildings (136.7% vs -10.5% in May). Additional support came from residential buildings (7.8% vs -13%) and additions & alterations (8.9% vs -14.2%).

Sources: Bloomberg, Reuters, Trading Economics