January 29, 2013

Why QE3 Will Be a Boon to Africa’s Frontier Markets

We are pleased to offer for download Larry Seruma’s whitepaper, “Why QE3 Will Be a Boon to Africa’s Frontier Markets”.
On September 13, Federal Reserve Chairman Ben Bernanke announced a new monetary stimulus initiative that the media promptly dubbed “quantitative easing (QE3).” In addition to continuing its existing bond-buying program, the Fed said it would acquire $40 billion per month of mortgage-backed securities and “employ other policy tools” indefinitely, until the U.S. labor market improves.

This third round of QE will be more open-ended than the Fed’s first two rounds. It came at a time when: 1) interest rates already are at rock-bottom in the U.S.; and 2) developed markets and other central banks around the world are printing money at full throttle. Greatly diminishing investors’ desire to hold cash and currency, this third round of monetary stimulus could continue for years.

In this article, we will explain why frontier markets will be prime recipients of the powerful investment flows QE3 will set in motion. We will also focus on characteristics that will make selected frontier markets, especially sectors of Africa, more attractive for QE3-driven flows.
To download the whitepaper, please click here.

For more information please contact Nile Capital Management at info@nilecapital.com or 646-367-2820.
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