LOCKDOWN LEVEL 3  [Adjusted ver. 3] 


Vaccine rollout day 186

New cases 7502
New Deaths 573
Recovery Rate 91.5%

By the close of trading on Wednesday 11th August 2021, the South African rand strengthened against the US dollar. Court cases and the Zondo Commission were the order of the day as President Cyril Ramaphosa took to the stand and finished the day blurting out the words Disgusting in reference to State capture. Ramaphosa gave evidence that at one stage he almost resigned from cabinet.  His evidence will resume today.

  • In SA, business confidence fell to its lowest level in July, amid the domestic civil unrest and looting, along with harder COVID-19 lockdown restrictions. In the US, the consumer price index (CPI) increased at a slower pace in July, indicating that inflation might have peaked as supply-chain distractions caused by the pandemic work their way through the economy.
  • Kansas City Fed President, Esther George stated that the standard for reducing the bond-buying program may have been met amid the current spike in inflation, recent labour market improvements and expectations for strong demand. He added that he supports the plans for bringing asset purchases to an end under these conditions. Atlanta Fed President, Raphael Bostic stated that inflation had reached the central bank’s 2.0% long-term inflation threshold.  Tapering of asset purchases could start as early as year end says Fed’s Daly.
  • The U.S. Treasury sold $41 billion in 10-year notes Wednesday at a high auction yield of 1.34% as foreign buyers scooped up the benchmark paper amid signals of peaking inflation and a potentially stalled domestic recovery. Investors bid $2.65 for every $1 on offer from the Treasury, auction data showed, notably firmer than the 2.39 ‘bid-to-cover’ ration recorded at the last auction on July 12, when the yield was 1.371%. Foreign buyers, the data indicated, took down just over 77% of the sale, suggesting the week’s $126 billion in new bonds sales are unlikely to disrupt markets as investors hunt for returns.
  • Forty-six Republican senators signed a letter indicating they won’t vote for an increase in the debt limit a move that could risk the Treasury defaulting on its obligations as soon as next month. In addition, the Democrats’ $3.5 trillion budget resolution didn’t include the cap.
  • The yield on benchmark government bonds fell yesterday. The yield on 2026 bond stood at 7.42%. Further, the yield on 2023 bond declined to 4.99%, while that for the longer-dated 2030 issue stood at 8.94%.

In early trade on Thursday 12th August 2021, the US dollar is trading marginally higher against the South African rand at R14.6679, while the euro is trading marginally lower at R17.2146.  The British pound has marginally gained against the South African rand to trade at R20.3426.

By the close of trade on Wednesday 11th August 2021, the euro declined against most of the major currencies.

  • China denounced Canadian Prime Minister Justin Trudeau’s comments as “extremely unreasonable, absurd and arrogant,” as Beijing ramped up an 11th-hour effort to prevent a Huawei Technologies Co. executive’s extradition to the U.S. The Chinese Embassy in Ottawa expressed its “great indignation and strongest condemnation” in a statement Thursday protesting Trudeau’s criticism of an 11-year prison sentence of Canadian national Michael Spavor. The prime minister had condemned the verdict in Spavor’s politically charged spying trial Wednesday as “absolutely unacceptable and unjust.”
  • In Germany the CPI was steady in July.
  • In New Zealand, vaccinations will be open to all eligible ages from 1 September and the gap between first and second doses will be moved to six weeks instead of three, as the government continues with its elimination strategy. People should also expect the rules around mask wearing and QR code scanning to change at higher alert levels. The government has been responding to the Skegg report on reconnecting New Zealand with the rest of the world.
  • The spread of the delta variant of the coronavirus from Sydney into regional areas of New South Wales state which had 344 cases on Wednesday  has forced another Australian city into lockdown. Dubbo, a city of about 50,000 people some 240 miles from Sydney, is the latest to have stay-at-home orders enforced for at least one week after two cases of the infectious variant were detected, New South Wales Premier Gladys Berejiklian told reporters. Meanwhile Melbourne, Australia’s second-largest city, extended its lockdown for another week.

In early trade on Thursday, the euro has marginally advanced against the US dollar to trade at $1.1764, while it has marginally weakened against the British pound to trade at GBP0.8436.