By the close of trade on Thursday, the South African rand weakened against the US dollar.

  • Fears about coronavirus weighed on risk sentiment. The World Health Organization in Geneva just declared the epidemic virus spreading out of China is a public health emergency of international concern. The toll: So far, there are more than 8,000 confirmed cases of coronavirus in 22 countries and 171 deaths, according to Johns Hopkins. Nearly all the cases are in China, where the virus is believed to have first started circulating in November in the city of Wuhan. New worries: Today, the US reported the first case of person-to-person spread of the virus, between a Chicago woman who had returned from Wuhan and her husband.
  • Locally, producer price index (PPI) rose in line with market expectations on an annual basis in December, driven by rise in prices of coke, petroleum, chemical, rubber and plastic products.
  • A report by the International Monetary Fund recommended the South African government to introducer fiscal consolidation with decisive structural reform to boost investment and growth in the country.
  • In the US, annualised gross domestic product (GDP) rose in line with market expectations, after receiving a significant boost from a temporary decline in imports.
  • The yield on benchmark government bonds ended mixed yesterday. The yield on 2021 bond ended steady at 6.58% while that for the longer-dated 2026 issue rose to 8.03%.

In early morning trade on Friday, the US dollar is trading marginally higher against the South African rand at R14.7713, while the euro is trading marginally lower at R16.2839. The British pound has gained marginally against the South African rand to trade at R19.3417.

by the close of trade on Thursday, the euro advanced against most of the major currencies.

  • The pound’s spike about 15 seconds before the Bank of England’s interest-rate decision prompted traders and analysts to wonder if there had been a leak. Sterling shot upwards just before BOE policy makers surprised markets by voting 7-2 for no change
  • The eurozone economic sentiment increased more than expected in January, as confidence among manufacturers rose, while unemployment dropped to its lowest level since May 2008.
  • Preliminary reading of German consumer price index (CPI) rose in line with market expectations on an annual basis in January. In the UK, the BoE kept the key interest rate steady as it saw signs of a post-election pick-up in growth.
  • When the United Kingdom (UK) voted to leave the European Union (EU), few expected that the ensuing negotiations would take over three years and trigger two general elections. Disagreement over the extent of and timeline for the UK’s separation from the bloc continued through the end of 2019. Only after the UK Conservative Party’s landslide victory in December did the path forward become clear. While the UK will formally leave the EU on January 31, 2020, it now enters a transition period during which it will remain in the EU’s customs union and single market until their future relationship is hashed out.

In early morning trade on Friday, the euro has slipped 0.1% against the US dollar to trade at $1.1024, while it has weakened 0.1% against the British pound to trade at GBP0.8419.