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

  • A high-level conversation… spun as progress… additional headlines from various administration officials all claiming a trade deal with China is close… and hey presto – more gains for stocks and more new record highs.. China priced a $6 billion four part deal in a sovereign bond offering that will serve as a pricing benchmark for borrowers from the world’s second largest economy. Investor demand for these bonds was massive with orders in excess of $20 billion within a few hours of the deal announcement.
  • South Africa’s leading business cycle indicator fell in September.
  • In the US, goods trade deficit narrowed in October.
  • The US home price index advanced on an annual basis in September.
  • On the contrary, consumer confidence fell for the fourth month in a row in November.
  • A separate report showed that new home sales fell on a monthly basis in October.
  • The Federal Reserve (Fed) Board Governor, Lael Brainard, stated that the central bank should avoid raising rates in the future until inflation hits or even exceeds the Fed’s 2.0% target for an extended period.
  • The yield on benchmark government bonds ended mixed yesterday. The yield on 2020 bond ended flat at 6.89% while that for the longer-dated 2026 issue rose to 8.47%.

In early trade on Wednesday morning, the US dollar is trading marginally higher against the South African rand at R14.8073, while the euro is trading marginally lower at R16.3091. The British pound has declined 0.1% against the South African rand to trade at R19.0328.

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

  • German consumer confidence index improved in December, suggesting that household spending will continue to prop up growth in Europe’s biggest economy at the end of the year.
  • Separately, the European Central Bank Board member, Benoît Cœuré, stated that Europe is at risk of losing its economic edge and that national fragmentation has paralyzed competition and stifled innovation on the pan-European level.

In early trade on Wednesday morning, the euro slipped 0.1% against the US dollar to trade at $1.1014, while it has marginally gained against the British pound to trade at GBP0.8569.