By the close of trade on Monday, the South African rand weakened against the US dollar.

  • Investors expressed caution after a second wave of Covid-19 infections hit South Korea and Germany.
  • Trade war season 2 as U.S. President Donald Trump said on Monday he opposed renegotiating the U.S.-China “Phase 1” trade deal after a Chinese state-run newspaper reported some government advisers in Beijing were urging fresh talks and possibly invalidating the agreement.  Trump, wanted to see if Beijing lived up to the deal to massively increase purchases of U.S. goods.
  • In the US, the Federal Reserve’s (Fed) Vice Chairman for banking supervision, Randal Quarles, stated that the central bank will use all of its financial firepower to protect the US banking system from the coronavirus crisis.
  • The Federal Reserve Bank of New York’s Center for Microeconomic Data released the April 2020 Survey of Consumer Expectations, which shows considerable deteriorations in households’ expectations about most economic outcomes. The perceived probability of losing one’s job reached a new series’ high for the second consecutive month. Expected earnings, income, and spending growth each reached series’ lows. The perceived and expected availability of credit worsened.
  • The yield on benchmark government bonds rose yesterday. The yield on 2026 bond rose to 7.80%. Further, the yield on 2023 bond advanced to 5.28% while that for the longer-dated 2030 issue rose to 9.41%.

In early trade on Tuesday, the US dollar is trading 0.2% higher against the South African rand at R18.4527, while the euro is trading 0.1% higher at R19.9293. At 06:00 SAST, the British pound has marginally gained against the South African rand to trade at R22.7267.
By the close of trade on Monday, the euro advanced against most of the major currencies.

  • The pound was already weighed down by concern over trade talks between the U.K. and Europe and the economic fallout of the virus when Prime Minister Boris Johnson added one more reason to be uneasy. The pound weakened as much as 1% against the dollar, the most in three weeks, after Johnson’s public address on Sunday about his government’s plan to ease the nationwide lockdown lacked clarity.
  • Meanwhile, Italian industrial production fell more than expected on a monthly basis in March, as a lockdown imposed to contain the coronavirus pandemic shuttered most businesses.

In early trade on Tuesday, the euro has slipped 0.1% against the US dollar to trade at $1.0800, while it has gained 0.1% against the British pound to trade at GBP0.8769.

Below is a link to a very detailed Covid-19 picture giving stats and graphs.