By the close of trade yesterday, following President Ramaphosa’s meeting with key Ministers and ESKOM, the South African rand strengthened against the US dollar.  It seems like Ramaphosa’s bold statement that the lights will remain on from the middle of Christmas has found favor.

  • In South Africa, consumer price inflation slowed to its lowest levels since December 2010, on an annual basis in November. This was in line with expectations.
  • Retail sales marginally slowed in October, reaching its lowest levels in seven months.
  • The greenback lost ground, after the Fed left benchmark interest rate at the target range of between 1.50% and 1.75%, a decision that was widely expected and added that it expected to make no changes in either direction throughout 2020. The Fed policymakers stated they would continue monitoring global developments in deciding whether interest rates need to change. They also said they would keep an eye on “muted inflation pressures,” a reflection of concern that the pace of price increases has failed to hit the central bank’s target.
  • FED’S Powell says if USMCA deal is enacted, it would remove some uncertainty and be a positive for the US economy.
  • On the data front, US consumer price index (CPI) rose more-than-expected on an annual basis in November.
  • The yield on benchmark government bonds fell yesterday. The yield on 2020 bond declined to 6.82% while that for the longer-dated 2026 issue fell to 8.38%.

In early trade on Thursday, the US dollar is trading 0.1% lower against the South African rand at R14.6709, while the euro is trading 0.1% higher at R16.3497.   The British pound has gained 0.1% against the South African rand to trade at R19.4031.

By the close of trading on Wednesday, the euro advanced against most of the major currencies.

  • In the UK, a latest election poll raised the prospect of a hung parliament. The YouGov poll suggested that the Conservative majority had fallen to 28 seats from 68 seats a couple of weeks ago and compared with 80 at the start of campaigning ahead of the election results.

In early trade on Thursday, the euro has advanced 0.1% against the US dollar to trade at $1.1144, while it has weakened 0.1% against the British pound to trade at GBP0.8428.

Hopefully we are going to see the tail end of the rain here along the east coast.  Have a great day everyone.