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

  • Fears of a second wave of coronavirus infections continued to weigh on riskier assets.
  • A defacto lockdown in the United States has lasted longer than expected despite a rollback in some restrictions on mobility, pointing to a deeper-than-expected contraction in gross domestic product in the second quarter, the IMF said on Thursday. Details will be available when the International Monetary Fund releases its updated World Economic Outlook on June 24
  • In the US, the number of people filing for unemployment benefits fell for the week ended 12 June, but the pace of decline has stalled amid a second wave of layoffs, as companies battle weak demand and fractured supply chains, supporting views that the economy faces a long and difficult recovery from the COVID-19 recession.
  • The Philadelphia Fed business conditions index significantly rebounded in June, driven by improving new orders, shipments, prices and lower inventories.
  • U.S. Secretary of State Michael Pompeo said China’s top foreign policy official committed in a meeting this week to honor all of his nation’s commitments under its first-phase trade deal with President Donald Trump. “During my meeting with CCP Politburo Member Yang Jiechi, he recommitted to completing and honoring all of the obligations of Phase 1 of the trade deal between our two countries,” Pompeo said in a tweet on Thursday. It was the first substantive news out of Pompeo’s secretive meeting with Yang at Hickam Air Force Base in Hawaii on Wednesday.
  • The yield on benchmark government bonds fell yesterday. The yield on 2026 bond fell to 7.72%. Further, the yield on 2023 bond declined to 5.06% while that for the longer-dated 2030 issue fell to 9.31%.

In early trade on Friday, the US dollar is trading 0.1% lower against the South African rand at R17.4609, while the euro is trading marginally lower at R19.5733.  The British pound has marginally declined against the South African rand to trade at R21.6988.

By the close of trade on Thursday, the euro advanced against most of the major currencies.

  • In the UK, the Bank of England (BoE) kept the key interest rate unchanged and added another GBP100.00bn to its quantitative easing program in a bid to shore up the UK economy amid the fallout from the coronavirus crisis. However, the central bank stated that the increase should see it through to the end of the year, as it saw some signs that the British economy was recovering from the unprecedented slump caused by the coronavirus lockdown.  The Bank of England is growing increasingly worried that British job losses will turn out worse than expected and threaten the recovery from the coronavirus pandemic. The government has taken unprecedented steps to protect jobs by paying most of the wages of workers while businesses are shuttered.
  • Asian markets already have one eye on the weekend it appears, with price action subdued across the board after a cautious New York overnight session. The data calendar is a threadbare cupboard for the region today, meaning that markets are only likely to move forcefully on unexpected headline surprises.

In early trade on Friday, the euro has marginally advanced against the US dollar to trade at $1.1210, while it has marginally gained against the British pound to trade at GBP0.9020.

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