By the close of trade on Friday, the South African rand strengthened against the US dollar, as optimism about a new stimulus package in the US boosted risk taking.

  • The U.S. dollar edged higher at the start of the week as U.S. coronavirus infections hit a record for a second day. Asia stocks were set for a muted open as stimulus talks stalled in Washington.
  • As the fall season surge continues, the United States has reported its second-highest day of new Covid-19 cases, according to data from Johns Hopkins University. Saturday saw 83,718 new cases, just 39 cases shy of the all-time record that was reported Friday. Health experts have warned that the fall season would bring a resurgence of cases — and since the US never lowered its daily case baseline enough, they say compounding cases will likely get worse. Already, national cases total over 8.6 million and 225,061 people have died, according to JHU.
  • U.S. House Speaker Nancy Pelosi on Sunday said the Trump administration was reviewing the latest plan for more COVID-19 relief over the weekend and that she expected a response on Monday, adding that she was still optimistic a deal could be reached. Pelosi said she would still pursue an agreement after the Nov. 3 election regardless of its outcome, but that she wanted to see a deal for another round of federal financial aid amid the novel coronavirus pandemic as soon as possible.
  • In the US, on the data front, business activity increased to a 20-month high in October, but the pace of new business growth and new orders eased slightly, amid the lingering COVID-19 pandemic and caution ahead of the US Presidential election.
  • The yield on benchmark government bonds rose on Friday. The yield on 2026 bond rose to 7.09%. Further, the yield on 2023 bond advanced to 4.39%, while that for the longer-dated 2030 issue rose to 9.27%.

In early trade on Monday, the US dollar is trading higher against the South African rand at R16.2632, while the euro is trading higher at R19.2444.  The British pound has gained against the South African rand to trade at R21.1766.

On Friday, the euro advanced against most of the major currencies.

  • The chief negotiators for the UK and EU will continue post-Brexit trade talks in London until Wednesday, says No 10. Michel Barnier arrived in the UK on Thursday to restart negotiations with Lord David Frost after they stalled last week – but he was due to return home on Sunday. EU sources told the BBC more talks are also planned in Brussels from Thursday. Northern Ireland Secretary Brandon Lewis said the extended talks were “a very good sign” a deal can be done.
  • Spain will hold a special cabinet meeting on Sunday to discuss a new state of emergency after regions urged government action to allow them to impose curfews to help tackle its escalating COVID-19 outbreak. Ten of Spain’s 17 regions including Asturias, Castilla-La Mancha and the Basque Country had called on the government to decree a state of emergency, which would allow them to limit people’s movements.
  • The eurozone’s manufacturing PMI advanced in October, while services PMI declined during the period, as a second wave of the coronavirus sweeps across the continent, heightening expectations for a double-dip recession.
  • German private sector activity grew for the fourth month running in October.
  • The manufacturing sector expanded at a faster rate, services activity shrank, suggesting that the Europe’s largest economy is operating at two different speeds.

In early trade on Monday, the euro slipped 0.2% against the US dollar to trade at $1.1833, while it has weakened 0.1% against the British pound to trade at GBP0.9087.