Weekly Market Update - Monday, July 27, 2026

AROUND THE GLOBE   

• U.S Business Activity Growth Accelerates to Eight‑Month High

• US private‑sector activity strengthened in July 2026, with the S&P Global Composite PMI rising to 53.6 from 51.9 in June, marking the strongest expansion since November 2025. The improvement was driven by the services sector, where activity accelerated to an eight‑month high, while manufacturing output continued to grow but at a slower pace, recording its weakest increase since March. Hiring increased for the first time in three months and business confidence climbed to an eight‑month high, although supplier delivery times deteriorated to their worst level in nearly four years amid Middle East-related disruptions.

• ECB Holds Rates Steady as Energy Risks Persist

• The European Central Bank left its key interest rates unchanged in July 2026, following a 25bp increase in June, as policymakers adopted a more cautious stance amid easing inflationary pressures and softer economic momentum. The ECB noted that while energy prices remain volatile, the outlook is broadly consistent with its June projections, though uncertainty remains elevated and the full impact of the recent energy shock has yet to be reflected in inflation data. 

• UK Inflation Eases More Than Expected in June

• The UK’s annual inflation rate slowed to 2.6% in June 2026, down from 2.8% in May 2026 and below market expectations of 2.7%, marking the lowest reading since March 2025. The moderation was driven by softer transport inflation (5.7% vs. 6.8% in May), largely reflecting lower fuel prices, while food inflation eased to 1.7% (vs. 2.2% in May), its lowest level since August 2024. On a monthly basis, consumer prices rose 0.1% (vs. 0.2% in May), in line with market forecasts.

• Euro Area Services Activity Returns to Expansion in July

• The Eurozone services sector returned to growth in July 2026, with the S&P Global Services PMI rising to 51.6 from 49.4 in June, marking a five‑month high and comfortably exceeding market expectations of 49.8. The rebound reflected renewed growth in business activity, while employment improved, with service providers leading overall job creation across the private sector.

• UK Private Sector Activity Rebounds in July

• The S&P Global UK Composite PMI rose to 52.1 in July 2026, up from 49.3 in June and well above market expectations of 49.7, marking a return to expansion after two consecutive months of contraction. The improvement was supported by stronger activity in both manufacturing (53.6 vs. 52.6 in June) and services (51.8 vs. 48.8 in June), with the latter recovering from second-quarter weakness caused by the Iran conflict, which had pushed up energy costs and weighed on consumer demand.

• BoG Keeps Policy Rate Unchanged at 14%

• The Bank of Ghana (BoG) maintained its benchmark interest rate at 14.0% during its July 2026 meeting, extending a pause in its easing cycle after five consecutive rate cuts. The decision reflects a cautious policy stance amid heightened geopolitical uncertainty and renewed inflation risks, with Governor Johnson Asiama noting that policymakers need more time to assess incoming data and its implications for the domestic economy. Meanwhile, headline inflation accelerated to 5.3% in June from 3.7% in May, driven largely by higher fertilizer and energy-related costs following the earlier surge in global oil prices.

Nigeria Holds Policy Rate at 26.5% Amid Persistent Inflation Risks

• The Central Bank of Nigeria (CBN) kept its benchmark interest rate unchanged at 26.5% at its July 2026 meeting, maintaining a cautious stance amid persistent inflationary pressures and heightened uncertainty stemming from renewed tensions in the Middle East. Governor Olayemi Cardoso noted that the Nigerian economy has remained relatively resilient to external shocks, supported in part by expanding domestic refining capacity, while policymakers opted to hold rates steady to assess incoming economic data.
  
  South Africa Unexpectedly Holds Rates Steady

• The South African Reserve Bank (SARB) left its benchmark repo rate unchanged at 7.0% in July 2026, surprising markets that had widely expected a 25bp rate increase, as policymakers sought to balance persistent inflation risks against a fragile economic recovery. The Monetary Policy Committee voted 4–2 in favor of holding rates, citing a more favorable inflation outlook and weaker growth conditions, while reaffirming its commitment to gradually steering inflation toward its 3.0% target.