Ghana Market Update - Cal Asset Management Company Ltd.

Investment Climate Brief 15th - 19th Jun '20

GSE-FSI goes into double-digit loss for the first time in 2020 following price declines in four financial stocks.
The Government of Ghana (GoG) yield curve witnesses downward shift across the short tenor securities.

ECONOMIC SCOOP

Food inflation remains elevated as May inflation closes at 11.30%

Headline inflation rose to 11.30% in May compared to 10.60% in April 2020.
Food and non-alcoholic beverages prices was at 15.10% up from 14.40% in the prior month.
Non-food inflation also went up by 0.70% to close the month at 8.40%.
With the ongoing closure of Ghana’s borders imported inflation remains low at 4.80%, while local inflation was 14.10%.

The local bourse posted mixed performance during the week as the GSE-CI and GSE-FSI moved in opposite directions.
On the secondary Treasury market, the Government exceeded its auction target of GHS 875m as a total of GHS 921.23m was raised.

ECONOMIC SCOOP

Disbursement of Government’s GHS 600m COVID-19 stimulus package to MSMEs set to begin this week.

The National Board for Small Scale Industry (NBSSI) has revealed that about 200,000 applicants are expected to benefit from the programme.
The disbursement exercise is expected to close by 20^th June 2020.
The NBSSI also announced that another amount of GHS 90m secured together with the Mastercard Foundation is to be disbursed to selected beneficiaries when the GHS 600m package begins to deplete.

As the COVID-19 pandemic keeps ravaging economies around the globe, the Government lines up some relieve and stimulus programmes to ease the impact of the virus on the Ghanaian economy, including the USD 100 million(GHS 572 million equivalent) COVID-19 Preparedness and Response Plan to fight the pandemic and the Coronavirus Alleviation Programme (CAP) (estimated size of GHS 1.25 billion/USD 219 million) and COVID-19 National Trust Fund to help revive the economy.

The local bourse failed to record any weekly gainers for the second time running
The GSE-FSI recorded its highest drop in the year, as it declined by 51.88 points

The GSE-CI lost its recent upsurge owing to losses in four stocks as it posted a year-to-date return of -3.06%.
Government offers improved yields in the latest run of issuances