Vaccine rollout day 168

New cases 8929
New Deaths 596

By the close of trade on Tuesday 20th July 2021, the South African rand weakened against the US dollar. As South Africans rallied together to ensure the food and essential items supply continued to flow, there are reports of even greater missions of success as small planes are delivering hope and help to the people of the KZN Midlands.  After appeals went out on social media for pet food, nappies, baby formula and food, the Howick Flying Club stepped up and made it’s landing strip available for relief flights. The planes, which are packed with essential items in Johannesburg, are flown from Randburg Airport to the airfield, which is situated on land off the R617 (Howick to Underberg road).   6 People have now appeared in courts for their masterminding of the insurrection” as described by President Ramaphosa.  There was no way that the top brass of the South African National Defense Force (SANDF) would have told the president one thing [Insurrection] and the minister of defense another.

  • Stocks bounced back sharply on Tuesday as the S&P 500 erased nearly all of Monday’s losses. Investors were relieved that Treasury yields stopped falling but beyond that, there was no specific news or catalyst. The COVID-19 delta variant is a big worry but as long as hospitalizations and serious complications are limited in countries with high vaccination rates, investors are buying the dips. That could change quickly but for now, medical experts and government leaders continue to believe that more widespread vaccination is the solution to slowing the spread of the delta variant.
  • In the US, homebuilding increased more than expected in June. However, building permits declined to an eight-month low, due to expensive building materials as well as labour and land shortages. Single family housing starts continued to rise in June, many of those for homes already sold. But building permits, an indicator of future construction, fell more than expected last month to the lowest point since August and were about 100,000 units below the six-month average, according to the U.S. Census Bureau.
  • Since March 2020, governments have spent $16 trillion providing fiscal support amid the pandemic, and global central banks have increased their balance sheets by a combined $7.5 trillion. Deficits are the highest they have been since World War II and central banks have provided more liquidity in the past year than in the past 10 years combined. This was absolutely necessary IMF research indicates that if policymakers had not acted, last year’s recession, which was the worst peacetime recession since the Great Depression, would have been three times worse.
  • French President Emmanuel Macron is one of several world leaders believed to have been targeted for phone hacking using spyware, media reports say. The software, known as Pegasus, infects phones and allows operators to spy on their targets. The leaders are on a list of some 50,000 phone numbers of people believed to be of interest to clients of Israeli-based firm NSO Group. The list was leaked to major news outlets. NSO denies any wrongdoing. It says the software is intended for use against criminals and terrorists.
  • The yield on benchmark government bonds fell yesterday. The yield on 2026 bond fell to 7.44%. Further, the yield on 2023 bond declined to 5.18%, while that for the longer-dated 2030 issue fell to 8.93%.

In early trade on Wednesday 21st July 2021, the US dollar is trading higher against the South African rand at R14.6842, while the euro is trading higher at R17.2862.  The British pound has gained against the South African rand to trade at R19.9768.

By the close of trade on Tuesday 20th July 2021, the euro advanced against most of the major currencies,

  • The European Central Bank announced that the eurozone banks expect corporate loan demand to increase in the 3Q21 period as well as a moderate tightening of credit standards or loan approval criteria.
  • Meanwhile, German producer price index (PPI) data rose in June, indicating strong inflation amid supply constraints.
  • Bank of Japan policymakers saw the price outlook muddled by rising global commodity costs and soft consumption, minutes of their June meeting showed, underscoring the central bank’s policy conundrum brought on by the COVID-19 pandemic. Japan has not been immune to global commodity inflation with companies seeing input costs rising, though consumer prices have barely risen in contrast to those of other advanced nations that are reopening their economies.

In early trade on Wednesday 21st July 2021, the euro has slipped against the US dollar to trade at $1.1756, while it has marginally gained against the British pound to trade at GBP0.8726.