In 2025, African stock markets, bonds, and currencies are leading all other emerging markets in performance. This is primarily due to repeatedly record-high metal prices, a depreciating US dollar, and the eventual payoff from painful economic and exchange rate reforms implemented by many countries.
Measured in US dollars, the stock markets of South Africa, Nigeria, Kenya, and Morocco have all posted investment returns of at least 40% so far this year, outpacing the MSCI Emerging Markets Index’s 31% gain. This also marks the strongest year for these stock markets since 2017.
The total market capitalization of MSCI Emerging Markets index constituents has increased by $2.6 trillion (109.15 trillion ringgit) so far this year, mainly driven by Asia’s chip manufacturing and technology stocks. However, due to investors concentrating their bets on these sectors, some investment institutions now advocate for greater market diversification, especially into emerging markets dominated by commodities, consumer goods, and banking stocks.
The highest-rising African stock markets are some of the smaller ones, such as Ghana and Zambia, where surging gold and copper prices have pushed their US dollar-denominated stock market gains to more than double so far this year. The currencies of both countries have also appreciated against the US dollar by 25% to 33%, an increase topped only by the Russian ruble. Zambia’s inflation rate has fallen below 12%, while Ghana’s has dropped to single digits.
US dollar-denominated African sovereign bonds have also rebounded, with yields in most countries falling below 10%. Kenya and Angola recently succeeded in issuing new sovereign bonds.