LOCKDOWN LEVEL Ver 3.1 [DAY 36]

TOTAL DAYS 101 – 07 HOURS 16 MINUTES

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

  • Fears of a rebound in global COVID-19 infections abound as well as heightened concerns about the local economy.    In Austria the F1 GP shortened race season kicked off behind closed doors at the Red Bull Ring in Austria.  What was unfolding as a pedestrian second half of the F1 race with Mercedes leading 1&2 turned out to be utter carnage as only 11 cars finished the race.  Lewis Hamilton was penalized 5 seconds and lost his second place some 9 laps from the finish.   Well done Bottas on topping the podium.
  • The world economy is entering the second half of 2020 still deeply weighed down by the coronavirus pandemic with a full recovery now ruled-out for this year and even a 2021 comeback dependent on a lot going right.
  • US-China heat ramps up once again as U.S. preparing global sanctions on China in connection to Xinjiang abuses.  Meanwhile Chinese regulators are urging struggling corporate bond issuers to seek voluntary debt restructuring in talks with their bondholders as a way to avoid default, as regulators last week issued new rules that seek to enforce investors’ protection amid rising defaults. In building a more uniform, transparent approach for corporate bond issuers to handle a default, the People’s Bank of China has called for more debt restructuring, a practice that has long existed in other markets but is still relatively new in China.
  • Florida’s Covid-19 cases rose on Sunday in line with the one-week average but still above 10,000 as the head of the U.S. Food and Drug Administration said it was too soon to tell if the Republican convention in Jacksonville will be safe. Reported cases rose by 10,059, or 5.3%, to 200,111, compared with an average 5.3% in the previous seven days. The Sunshine State set a record with 11,458 cases on Saturday. Deaths reached 3,731, according to the report, which has data through Saturday, up by 29.
  • The yield on benchmark government bonds rose on Friday. The yield on 2026 bond rose to 7.71%. Further, the yield on 2023 bond advanced to 4.96% while that for the longer-dated 2030 issue rose to 9.40%.

In early trade on Monday, the US dollar is trading 0.4% lower against the South African rand at R16.9786, while the euro is trading 0.1% lower at R19.1482.  The British pound has declined 0.4% against the South African rand to trade at R21.1993.

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

  • A second Spanish region made up of 70,000 people is going back into lockdown after a new coronavirus outbreak. Entry into and out of La Marina, which lies 90 miles east of La Coruna in Galicia, will be banned from midnight tonight and gatherings of more than ten people will be banned to limit the possibility of contagion. Locals will not be stopped from moving within the 14 municipalities that make up the region. The use of face masks will also be made mandatory at all times outdoors, including on beaches and swimming pools. Bars and restaurants will have to respect new closing times and tighter restrictions
  • The German services PMI unexpectedly rose in June, as the country lifted coronavirus-led lockdown restrictions.
  • In the eurozone, the plunge in business activity caused by lockdowns imposed to stop the spread of the coronavirus eased in June, as more businesses re-opened and people ventured out.
  • The European Central Bank (ECB) President, Christine Lagarde, warned that the eurozone faces about two years of downward pressure on prices, but could see a turnaround after that because the coronavirus crisis will accelerate the transformation of the economy and in the meantime, the central bank will need to keep its monetary policy exceptionally loose and financial instruments will need to be developed that allow the economic transformation to be funded.

In early trade on Monday, the euro has advanced 0.3% against the US dollar to trade at $1.1278, while it has gained 0.2% against the British pound to trade at GBP0.9033.

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

https://www.covid19sa.org/