In this week's edition:
· US Stocks Rebound Following Court Ruling Against Trump’s Tariff Policies
· Gold Pulls Back with a 2.03% Weekly Decline as Strong Economic Data Temper Safe-Haven Demand Amid Trade War Risks
· Ghana’s Treasury Accepts All Bids but Records 9.06% Undersubscription as Yields Continue to Decline Across the Curve
· Broader Market Weakens Further as MTNGH Sell-Off Deepens; GSE-CI Drops to 25.81% YTD, While Financial Stocks Index Maintains Momentum, Rising to 35.13%
- Kindly click to view the full report: Global Market Update - June 2, 2025
AROUND THE GLOBE
· US Economy Contracts Slightly in Q1, Revised Data Shows
o The US economy shrank by 0.2% on an annualized basis in Q1 2025, less than the initially reported 0.3% decline. The revision reflects stronger fixed investment (+7.8%) and export growth (+2.4%) but was weighed down by weak consumer spending (+1.2%) and a sharp surge in imports (+42.6%) ahead of new tariffs. Federal spending also fell by 4.6%, marking its steepest drop since early 2022.
· US PCE Inflation Cools in April 2025
o US PCE inflation rose by 0.1% in April 2025, matching expectations and indicating stable price growth. Core PCE also increased by 0.1%. Annually, headline inflation eased to 2.1%, the lowest in seven months, while core inflation dropped to 2.5%, a four-year low. The data signals cooling inflation and strengthens the case for a possible Federal Reserve rate cut.
· OPEC+ Announces an Increase in Output
o OPEC+ announced it will increase oil output in July by the same amount as in the past two months, alleviating concerns of a larger hike. On Saturday, the group agreed to add 411,000 barrels per day, signaling a continued strategic shift that has contributed to falling crude prices. The move is seen as a way to rein in overproducing members like Iraq and Kazakhstan, while enabling major producers such as Saudi Arabia and Russia to regain market share.
· Eurozone Credit Growth Hits 11-Month High
o Eurozone bank lending accelerated in April 2025, with household loans rising by 1.9% YoY and business loans up by 2.6%—both marking the fastest growth since mid-2023. Overall credit to the private sector expanded by 2.7%, driven by stronger demand amid ECB policy easing.
· China Factory Contraction Eases in May 2025
o China’s official manufacturing PMI edged up to 49.5 in May from 49.0 in April, signaling a slower pace of contraction and aligning with market forecasts. Output returned to growth (50.7), aided by a temporary trade truce and domestic stimulus. Although new orders, exports, and employment remained in decline, the rates eased. Input and selling prices posted the steepest declines in eight months, indicating deflationary pressures. Despite persistent weakness, business confidence improved to 52.5, hinting at cautious optimism ahead.
· Canada GDP Beats Expectations in Q1 2025
o Canada's economy grew by 0.5% quarter-over-quarter in Q1 2025, matching Q4’s pace and exceeding forecasts. Growth was largely driven by strong net exports (+1.6%) and a sharp rise in business inventories (+$8.7B), as firms rushed to beat US tariffs. However, core domestic demand softened—household spending slowed to 0.3% (from 1.2%), and government spending fell by 0.8%. On an annualized basis, GDP rose by 2.2%, well above the 1.7% forecast.
GHANA
· BoG Disburses $20 Million to BDCs in Latest Forex Auction to Support Fuel Imports
o The Bank of Ghana (BoG) released $20 million to six Bulk Oil Distribution Companies (BDCs) in its recent foreign exchange auction. This move aims to support fuel imports and stabilise the cedi. BoG plans to auction a total of $120 million to BDCs in Q2 2025 to ensure steady petroleum supply.
· Fuel Prices to Drop by up to 9% as Cedi Strengthens
o Ghana’s fuel prices are set to fall by 5-9% in the next pricing window, mainly due to the Cedi’s recent appreciation against the US Dollar, says the Africa Sustainable Energy Centre. Petrol may sell for GH¢12.00–12.60 per litre and diesel GH¢12.60–13.20. Lower crude prices also contribute but the Cedi’s strength is the key driver.
AFRICA
· Moody’s Upgrades Nigeria’s Credit Rating to B3
o Moody’s upgraded Nigeria’s credit rating from Caa1 to B3, citing improved external and fiscal positions and easing inflation risks. The outlook was revised from positive to stable, reflecting expected slower progress if oil prices fall. Nigeria’s S&P rating remains at B- with a stable outlook.
· South Africa Cuts Interest Rate to 7.25% Amid Improved Inflation Outlook
o The South African Reserve Bank cut its key rate by 25 bps to 7.25% in May 2025, citing easing inflation and weaker growth. Inflation is now projected at 3.2% in 2025, while growth was revised down to 1.2%. Policymakers aim to anchor inflation expectations closer to 3%, the lower end of the target range.
· Kenya Inflation Eases to 3.8% in May
o Kenya's annual inflation rate slowed to 3.8% in May 2025 from 4.1% in April, staying well within the central bank's target range of 2.5% to 7.5%. The deceleration was driven by slower price increases for food and non-alcoholic beverages (6.3% vs 7.1%). Transport inflation held steady at 2.3%. On a monthly basis, consumer prices rose by 0.5%, up from a 0.3% increase in April.
Sources: Bloomberg, Reuters, Trading Economics
