Vaccine rollout day 21 / J & J VACCINE DAY 8         

By the close of trading on Tuesday 23rd February 2021, the South African rand strengthened against the US dollar.

  • In South Africa, the unemployment rate jumped to a record high in the fourth quarter of last year, as the domestic economy was further battered by the COVID-19 pandemic.
  • Today the focus shifts to the Budget speech and the troubled waters that Tito Mboweni must navigate.
  • In the US, consumer confidence rose to a three-month high in February, after the US government stepped up its fiscal stimulus payments to families and domestic coronavirus cases fell sharply.
  • Federal Reserve Chairman Jerome Powell signaled that the central bank was nowhere close to pulling back on its support for the pandemic-damaged U.S. economy even as he voiced expectations for a return to more normal, improved activity later this year. “The economy is a long way from our employment and inflation goals, and it is likely to take some time for substantial further progress to be achieved,” he said in the text of testimony to be delivered Tuesday to the Senate Banking Committee.
  • The yield on benchmark government bonds mostly fell yesterday. The yield on 2026 bond fell to 7.09%. Further, the yield on 2023 bond advanced to 5.10%, while that for the longer-dated 2030 issue fell to 8.82%.

In early trade on Wednesday, the US dollar is trading higher against the South African rand at R14.5672, while the euro is trading higher at R17.6722.  The British pound has gained against the South African rand to trade at R20.6326.

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

  • In the eurozone, the consumer price index (CPI) remained steady on an annual basis in January.
  • Europe’s top banks must justify why they should not have to shift clearing of euro-denominated derivatives worth billions of euros from London to the European Union after Brexit.   Clearers in Britain have EU permission to continue clearing for EU customers until mid-2022 to give banks time to shift their euro positions to the continent, but switching has been slow. The banks are being asked to set out detailed views on shifting euro derivatives positions from London on Friday in the first meeting of a new European Commission working group on moving euro clearing.
  • Godwin Emefiele has reiterated the position of the Central Bank of Nigeria (CBN) that cryptocurrency currently has no place in Nigeria’s monetary system. The apex bank earlier in February directed Deposit Money Banks and other financial institutions to close accounts of people using their systems for cryptocurrency trading. Nigerian senators a week later invited the Emefiele to explain the reasons for the ban and Nigeria’s future plan for virtual assets.

In early trade on Wednesday, the euro has marginally advanced against the US dollar to trade at $1.2166, while it has weakened against the British pound to trade at GBP0.8622.