Precious Metal Derivatives - Eastern Africa

Eastern Africa

The nominal value in the Precious Metal Derivatives market is projected to reach US$39.14bn in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 5.30% resulting in a projected total amount of US$50.67bn by 2029.
The average price per contract in the Precious Metal Derivatives market amounts to US$0.09 in 2024.
From a global comparison perspective it is shown that the highest nominal value is reached in the United States (US$11,920.00bn in 2024).
In the Precious Metal Derivatives market, the number of contracts is expected to amount to 532.00k by 2029.

Market

Region

Region comparison

Currency

Analyst Opinion

The Precious Metal Derivatives market in Eastern Africa is experiencing a notable shift in dynamics, reflecting the evolving economic landscape and investor behavior in the region.

Customer preferences: Investors in Eastern Africa are increasingly turning to Precious Metal Derivatives as a way to diversify their portfolios and hedge against market volatility. The allure of these financial instruments lies in their potential for high returns and as a means to mitigate risks associated with traditional investments.

Trends in the market: In Kenya, there is a growing interest in gold derivatives as investors seek alternative assets amid uncertainties in the global economy. Tanzania, on the other hand, is witnessing a surge in silver derivatives trading, driven by a rising demand for industrial applications. Uganda is experiencing a shift towards platinum derivatives, reflecting a desire for exposure to a wider range of precious metals.

Local special circumstances: Eastern Africa's Precious Metal Derivatives market is also influenced by local mining activities and government regulations. Countries like Ethiopia, with a burgeoning mining sector, are seeing an uptick in demand for derivatives linked to locally sourced precious metals. In contrast, countries with stricter regulations on mining and exports may face challenges in accessing certain derivatives.

Underlying macroeconomic factors: The development of the Precious Metal Derivatives market in Eastern Africa is closely tied to factors such as global metal prices, currency fluctuations, and overall market sentiment. As the region continues to integrate into the global economy, investors are becoming more attuned to international market trends and geopolitical events that can impact the prices of precious metals and, consequently, the derivatives market.

Methodology

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.