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

  • Investors expressed caution about the coronavirus outbreak as South Korea reported an increase in coronavirus cases.
  • Asian shares were cast adrift on Friday as fears over the creeping spread of the coronavirus sent funds fleeing to the sheltered shores of U.S. assets, lofting the dollar to three-year highs. Even Wall Street turned south late on Thursday on reports of increased infections in Beijing, and as the virus spread in South Korea and Japan. Corporate earnings are increasingly under threat as U.S. manufacturers, like many others, scramble for alternative sources as China’s supply chains seize up.
  • Bank of Japan Governor Haruhiko Kuroda stated that we cannot measure impact of coronavirus yet and that the virus is likely to hit supply chains, tourism and exports. Japan will take appropriate measures as necessary but doesn’t believe policy measures are needed at this time.
  • China Commerce Ministry Official Says Coronavirus Has Posed Severe Challenges To China’s Current Foreign Trade Development
  • In the US, the number of people filing for unemployment benefits slightly rose for the week ended 14 February, suggesting that sustained labor market strength could help to support the economy amid risks from the coronavirus and weak business investment.
  • The Philadelphia Fed manufacturing index jumped to its highest level in three years in February.
  • The yield on benchmark government bonds fell yesterday. The yield on 2021 bond declined to 6.39% while that for the longer-dated 2030 issue fell to 8.85%.

In early trade on Friday, the US dollar is trading 0.1% lower against the South African rand at R15.1135, while the euro is trading marginally lower at R16.3077.  The British pound has marginally declined against the South African rand to trade at R19.4847.

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

  • The preliminary reading of eurozone consumer confidence improved in February.
  • On the flipside, German producer price index (PPI) rose more than expected on a monthly basis in January.
  • The European Central Bank (ECB) Vice President, Luis de Guindos, stated that the eurozone is on track for a modest economic growth but weak trade and the coronavirus outbreak keeps the outlook uncertain.

In early trade on Friday, the euro has marginally advanced against the US dollar to trade at $1.0790, while it has marginally weakened against the British pound to trade at GBP0.8369.