LOCKDOWN DAY 34 07 HOURS 06 MINUTES

 By the close of trade on Tuesday, the South African rand strengthened against the US dollar.   It was a solid day for the Rand as the currency netted a positive 20 cent gain by the close.  A good sign heading towards the close of the shortened week.

  • In the US, consumer confidence plunged to its lowest level in six years in April. Goods trade deficit widened in March, amid a collapse in exports of motor vehicles and parts, but overall imports continued to decline as the novel coronavirus outbreak disrupted the flow of goods.
  • Top Trump administration officials on Tuesday predicted a strong economic rebound in the fourth quarter as the coronavirus fades, but a senior White House adviser warned that near-term unemployment and GDP data will be a “very grave” negative shock. Kevin Hassett, senior economic adviser to President Donald Trump told CNN that unemployment could reach 16-20%, and GDP output could fall as much as 30-40% on annualized basis in the second quarter, a prediction in line with Wall Street and Congressional Budget Office forecasts.
  • The United States “could be in for a bad fall” if researchers don’t find an effective treatment to fight the coronavirus by then, White House health advisor Dr. Anthony Fauci said Tuesday. The virus will certainly make a comeback in the U.S. even as cases begin to stabilize, Fauci, the Director of the National Institute of Allergy and Infectious Disease, said during an interview with The Economic Club of Washington, D.C. Covid-19 is “not going to disappear from the planet,” he said, adding infectious disease experts are learning about how the virus behaves by watching emerging outbreaks in other countries.
  • The yield on benchmark government bonds fell yesterday. The yield on 2021 bond declined to 4.15% while that for the longer-dated 2030 issue fell to 10.81%.

In early morning trade on Wednesday, the US dollar is trading 0.5% lower against the South African rand at R18.5642, while the euro is trading 0.3% lower at R20.1421. The British pound has declined 0.2% against the South African rand to trade at R23.1572.

On Tuesday, the euro declined against most of the major currencies.

  • The European Central Bank stated that they expect emergency credit demand to surge again in the 2Q20 and that the central bank is likely to meet this with easier credit standards as government guarantees and liquidity measures kick in.
  • Fitch Ratings has downgraded Italy’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘BBB-‘ from ‘BBB’. The Outlook is Stable.
  • British retailers cut the prices of non-food items by the most since at least 2006 this month as they try to shift stock that they are struggling to sell due to the coronavirus, industry data showed on Wednesday. After figures on Tuesday showed the biggest fall in sales since December 2008, the data from the British Retail Consortium added to signs of the damage to the sector from the closure of non-essential stores to slow the spread of COVID-19.

In early trade on Wednesday, the euro has advanced 0.3% against the US dollar to trade at $1.0850, while it has weakened 0.1% against the British pound to trade at GBP0.8698.

NOVEL CORONAVIRUS STATS

3,084,563 confirmed cases

216,127 reported deaths

927,530 recovered

South Africa

Confirmed 4,996

Dead 93

Recovered 2,073

 Western Cape 1870

Gauteng 1377

KwaZulu-Natal 919

Eastern Cape 616

Free State 113

Limpopo 31

North West 29

Northern Cape 17

Last updated Apr 29, 2020