Vaccine rollout day 140 / J & J VACCINE DAY 128 [Phase 2]

By the close of trade on Tuesday 22nd June 2021 the Rand had strengthened. South Africa’s Gauteng province records over 9000 new cases, a single record for a Province as calls mount for tighter restrictions to be implemented across the province.

  • Federal Reserve Chair Jerome Powell on Tuesday reaffirmed the U.S. central bank’s intent to encourage a “broad and inclusive” recovery of the job market, and not to raise interest rates too quickly based only on the fear of coming inflation. “We will not raise interest rates preemptively because we fear the possible onset of inflation. We will wait for evidence of actual inflation or other imbalances,” Powell said in a hearing before a U.S. House of Representatives panel. MARKET REACTION: STOCKS: The S&P 500 extended modest gains after Powell’s testimony ended and unofficially closed up 0.52%.
  • The total U.S. national debt reached an all-time high of $28 trillion* in March 2021, the largest amount ever recorded. Recent increases to the debt have been fueled by massive fiscal stimulus bills like the CARES Act ($2.2 trillion in March 2020), the Consolidated Appropriations Act ($2.3 trillion in December 2020), and most recently, the American Rescue Plan ($1.9 trillion in March 2021).
  • Expansion of the Australian private sector continued at a strong pace in June, though slowed for the second month running following April’s record, according to Flash PMI® data. Survey respondents reflected that the sudden lockdown of Australia’s Victorian state had affected economic and demand conditions in the country. Private sector optimism likewise softened in the month. Meanwhile, inflationary pressures eased in June but remained elevated compared to historical data.
  • Cybercrime is one of the most pressing concerns for firms. Hackers perpetrate frequent but isolated ransomware attacks mostly for financial gains, while state-actors use more sophisticated techniques to obtain strategic information such as intellectual property and, in more extreme cases, to disrupt the operations of critical organizations. Thus, they can damage firms’ productive capacity, thereby potentially affecting their customers and suppliers.  The latest attack on the Continental pipeline demonstrated just this.
  • The yield on benchmark government bonds fell yesterday. The yield on 2026 bond fell to 7.6%. Further, the yield on 2023 bond declined to 5.28%, while that for the longer-dated 2030 issue fell to 9.06%.

In early trade on Wednesday, the US dollar is trading higher against the South African rand at R14.2836, while the euro is trading lower at R17.0326.   the British pound has marginally declined against the South African rand to trade at R19.8972.

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

  • The eurozone consumer confidence improved in June.
  • The Bank of England’s newly-designed £50 note featuring the portrait of Alan Turing has entered circulation. The release date coincides with what would have been the computer pioneer and wartime codebreaker’s birthday. It means the Bank’s entire collection of currently-printed banknotes is made of plastic for the first time. Paper £50 and £20 notes will no longer be accepted in shops from October next year, although post offices will still exchange them. The Bank of England’s own counter can also swap any old notes for their face value.
  • Foreign exchange reserves, also called forex reserves, are cash and other assets – normally gold – that are held by central banks or other monetary authorities like the International Monetary Fund (IMF).   As an example, according to the Bank of England bulletin, the central bank held £30.7 billion in foreign currency reserves in April 2021. These reserves are made up of gold, foreign currency assets, IMF special drawing rights and the UK’s Reserve Tranche Position (RTP).  Central banks maintain these reserves to balance the country’s payments, help influence the foreign exchange rate, and support confidence in financial markets. They are essentially the bank’s back-up funds that can be used in case of emergency.  Most FX reserves are usually held in what is known as reserve currencies.

At 06:00 SAST, the euro slipped 0.1% against the US dollar to trade at $1.1927, while it has marginally weakened against the British pound to trade at GBP0.8560