LOCKDOWN LEVEL 2 [DAY 30]  T-4 till Level 1


By the close of trade on Wednesday, the South African rand strengthened against the US dollar.

  • An improved short-term risk appetite among investors.
  • South African retail sales fell more-than-expected on an annual basis in July.
  • The Federal Reserve is committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum employment and price stability goals. The COVID-19 pandemic is causing tremendous human and economic hardship across the United States and around the world. Economic activity and employment have picked up in recent months but remain well below their levels at the beginning of the year. Weaker demand and significantly lower oil prices are holding down consumer price inflation.  The Federal Reserve concluded its two-day policy meeting, the last one before the November election on Wednesday, by pledging to keep interest rates near zero until 2023, as the central bank looks to continue to support the U.S. economic recovery out of the coronavirus recession.  In a widely expected move, the Fed kept short-term interest rates steady at the 0% to 0.25% range on Wednesday.
  • On the data front, US retail sales slowed in August, pointing to a stall in the economic recovery from effects of the coronavirus pandemic.
  • The yield on benchmark government bonds ended mostly lower yesterday. The yield on 2026 bond fell to 7.13%. Further, the yield on 2023 bond advanced to 4.43%, while that for the longer-dated 2030 issue declined to 9.21%.

In early trade on Thursday, the US dollar is trading 0.8% higher against the South African rand at R16.4024, while the euro is trading 0.4% higher at R19.2756.  The British pound has gained 0.4% against the South African rand to trade at R21.1744.

By the close of trade on Wednesday, the euro declined against most of the major currencies.

  • The Bank of Japan on Thursday maintained its ultra-easy monetary policy and emergency loan programs for the coronavirus-hit economy, as the nation experienced its first leadership change in nearly eight years. The decision came as the stock market has recovered to pre-pandemic levels, while exports expanded in August for the third straight month. New Prime Minister Yoshihide Suga, who was sworn in on Wednesday, has voiced his backing for BOJ Gov. Haruhiko Kuroda. Suga said on Wednesday that he will continue the policies pursued under Shinzo Abe, his predecessor as prime minister
  • The seasonally adjusted eurozone trade surplus widened in July.
  • In the UK, inflation plunged in August, as the British government’s “Eat Out to Help Out” scheme cut the cost of restaurant bills.
  • Gross domestic product (GDP) fell by 12.2 percent in the June 2020 quarter, the largest quarterly fall recorded since the current series began in 1987, as the COVID-19 restrictions in place through the quarter impacted economic activity, Stats NZ said today.

In early trade on Thursday, the euro has slipped 0.4% against the US dollar to trade at $1.1766, while it has weakened 0.1% against the British pound to trade at GBP0.9104.