Vaccine rollout day 50 / J & J VACCINE DAY 38  

 By the close of trade on Friday 19th March 2021, the South African rand weakened against the US dollar.  It has been 1 year since President Ramaphosa announced to South Africa that we would enter a period of unprecedented lock down to combat the virus.

  • In the US, the Federal Reserve (Fed) Chairman, Jerome Powell stated that the US economy has improved, crediting the Congress and the central bank for providing “unprecedented” support. However, he warned that the recovery is still far from complete. The Federal Reserve reported Monday that it earned $88.6 billion in 2020 and paid back to the federal government $86.9 billion, the largest Fed payment to the government in four years. The Fed said that its earnings were up $33.1 billion last year, a gain that reflected falling interest rates which meant the central bank paid commercial banks less in interest payments on bank reserves that the Fed requires them to keep. The $86.9 billion in payments to the U.S. Treasury was a 58.3% increase from the Fed’s payment of $54.9 billion in 2019.
  • The White House will consider splitting an estimated $3 trillion economic recovery proposal into two bills, The New York Times reported Monday. President Joe Biden aims to inject more money into the economy after this month’s passage of his top priority, a $1.9 trillion coronavirus relief package. His administration and congressional Democrats hope to revamp the country’s infrastructure, combat climate change and jolt an improving U.S. economy. The president’s advisors will bring him a plan as soon as this week that would divide the recovery proposal into two planks, the Times reported.
  • On the data front, existing home sales fell more than expected in February, as cold weather blanketed many parts of the country, and a rebound could be muted by rising mortgage rates as well as higher house prices amid tight supply.
  • The yield on benchmark government bonds mostly fell on Friday. The yield on 2026 bond fell to 7.34%. Further, the yield on 2023 bond advanced to 5.38%, while that for the longer-dated 2030 issue fell to 9.31%.

In early trade on Tuesday 23rd March 2021, the US dollar is trading higher against the South African rand at R14.7767, while the euro is trading higher at R17.6266.  The British pound has gained against the South African rand to trade at R20.4582.

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

  • Germany’s Chancellor, Angela Merkel has stated that Germany is in serious trouble.  Covid-19 numbers are rising with the British variant predominant.  Germany will implement emergency measures to halt the easing of coronavirus restrictions and extend the current lockdown through to April 18, officials announced on Tuesday. Talks between leaders of Germany’s 16 federal states and Chancellor Angela Merkel lasted until the early hours of the morning following a lengthy interruption. Health officials have warned a “third wave” of infections has exceeded the level at which authorities say intensive care units will be overburdened.
  • The German Bundesbank stated that the German economy is likely to shrink sharply this quarter, as pandemic-fighting curbs hit the services sector and even the booming construction industry slows.
  • The United States on Monday joined the European Union and other countries in imposing sanctions over Beijing’s human rights abuses against the Muslim Uyghur minority in the Xinjiang region, a move likely to further strain U.S.-China relations. Two Chinese government officials, including Chen Mingguo, vice chairman of the Xinjiang autonomous region, have been sanctioned as the United States is “committed to using the full breadth of its financial powers to promote accountability for the serious human rights abuses occurring in Xinjiang,” the Treasury Department said.

In early trade on Tuesday 23rd March 2021, the euro has marginally slipped against the US dollar to trade at $1.1927, while it has gained against the British pound to trade at GBP0.8622.