Frontier Markets Posted Mixed Growth in Q2 –Fitch
Frontier markets (FM) recovered further in 2Q24 with some recording their highest rates of gross domestic products (GDP) growth in several quarters, boosted by gains in exports.
In a commentary note, Fitch Ratings said Central banks have continued to cut policy rates as inflationary pressures subside, as highlighted in Fitch Ratings’ latest Frontier Vision chart pack.
Azerbaijan, Costa Rica, Georgia, Ghana, Honduras and Senegal, among others, recorded some of the strongest annual GDP growth rates in the second quarter of 2024, surpassing those of recent quarters.
In Vietnam, where more up-to-date data are available, the economy expanded 7.4% year on year in the third quarter of 2024, its highest annual rate of expansion since 13.7% in Q3 2022.
Fitch said the economies of El Salvador, the Maldives, Mongolia, Namibia and Zambia grew, although the pace of expansion slowed relative to previous quarters. Zambia recorded growth of 1.2% year on year, the weakest rate since the pandemic-related contraction of -3% year on year in 4Q 2020.
Most frontier-market central banks cut policy rates, including in Armenia, Costa Rica, Ghana, Guatemala, Jamaica, Jordan, Kenya, Mongolia, Mozambique, Namibia, Pakistan, Rwanda, Sri Lanka, Tajikistan and Uzbekistan.
In contrast, central banks in Honduras, Papua New Guinea and Nigeria have raised policy rates in recent months due to ongoing inflationary pressures. Nigeria has increased its main policy rate five times this year, most recently to 27.25% in September. # Frontier Markets Posted Mixed Growth in Q2 –Fitch
