By the close of trade on Monday, the South African rand weakened against the US dollar.
- Moody’s Investors Service slashed its 2020 GDP growth forecast for South Africa to 0.7% in 2020 from the 1.0% earlier. It also lowered its 2021 growth prediction to 0.9% from 1.2% previously, citing state owned utility company, Eskom’s power cuts and lackluster demand along with the contagion associated with the coronavirus epidemic.
- Traders are so fixated on the coronavirus that, in the absence of compelling reasons to do otherwise, they’re piling into hedges in case the contagion is a disaster for the global economy. Much of the activity involves bets that the Federal Reserve will feel increased pressure to reduce interest rates.
- Liu Zhiming, Director of Wuchang Hospital in coronavirus epicenter Wuhan passed away Tuesday due to COVID19, becoming the first hospital director to die amid the outbreak that caused over 70,000 infections in China. The latest data provided by China on people infected with coronavirus indicates a decline in new cases but “every scenario is still on the table” in terms of the epidemic’s evolution, the World Health Organization said on Monday.
- Jeff Bezos is putting his money where his mouth is, he’s committing to spending $10 BILLION of his own cash to fight climate change. The Amazon honcho announced Monday he’s launching the Bezos Earth Fund a global initiative he says will fund scientists, activists and non-government organizations that will spearhead efforts to protect the earth.
The yield on benchmark government bonds rose yesterday. The yield on 2021 bond advanced to 6.51% while that for the longer-dated 2030 issue rose to 8.89%.
In early trade on Tuesday, the US dollar is trading 0.2% higher against the South African rand at R15.0179, while the euro is trading 0.1% higher at R16.2687. The British pound has gained 0.2% against the South African rand to trade at R19.5298.
By the close of trade on Monday, the euro advanced against most of the major currencies.
- Meanwhile, German Bundesbank’s monthly report showed that German economic growth will remain weak in 1Q20, weighed down by weak exports and the coronavirus outbreak in China. It also added that the virus could disrupt global value chains and could lead to delivery bottlenecks for German companies.
- Britain and the European Union are going to rip each other apart in talks over a future trade deal, the French foreign minister, Jean-Yves Le Drian, has predicted, while also holding out hope that UK defence co-operation with Europe will continue.
- The Australian dollar could find long term relief from cyclical downturns if the country’s government decides to take climate change seriously, according to ABN Amro Bank NV. The Dutch bank expects the country’s focus to turn toward environmental policies after wildfires wreaked havoc on the economy and hurt the currency.
In early trade on Tuesday, the euro has marginally slipped against the US dollar to trade at $1.0833, while it has marginally weakened against the British pound to trade at GBP0.8330.