By the close of trade on Monday, the South African rand strengthened against the US dollar.
- Hopes that global central banks will consider stimulus measures to curb the economic impact of coronavirus. After last week’s not one but two Bloomberg op-eds by the Fed’s biggest ever dove, Narayana Kocherlakota, in which the former Minneapolis Fed president advocated not just a rate cut, but an emergency intermeeting rate cut. Sure enough, with the market now holding the Fed hostage and – in agreement with both Goldman and Bank of America – pricing in not just one but two rate cuts on or before March 18 as if the global economy is on the verge of a depression.
- Locally, total new vehicle sales advanced in February.
- In the US, factory manufacturing activity slowed in February as new orders contracted, reflecting worries about supply chain disruptions related to the fast-spreading coronavirus outbreak.
- The ISM manufacturing PMI grew at a slower-than-expected pace in February, as the coronavirus outbreak dampened sentiment in the sector.
- Construction spending rose by the most in nearly two years, hitting a record high in January.
- The yield on benchmark government bonds ended mixed yesterday. The yield on 2021 bond declined to 6.10% while that for the longer-dated 2030 issue rose to 9.15%.
In early trade on Tuesday, the US dollar is trading 0.1% higher against the South African rand at R15.4015, while the euro is trading 0.1% higher at R17.1481. The British pound has gained 0.2% against the South African rand to trade at R19.6721.
By the close of trade on Monday, the euro advanced against most of the major currencies.
- The European Central Bank (ECB) President, Christine Lagarde, stated that the bank was monitoring the coronavirus outbreak. The coronavirus outbreak is a fast developing situation, which creates risks for the economic outlook and the functioning of financial markets. The ECB is closely monitoring developments and their implications for the economy, medium-term inflation and the transmission of our monetary policy. We stand ready to take appropriate and targeted measures, as necessary and commensurate with the underlying risks
- On the data front, German manufacturing PMI unexpectedly rose in February, as declines in output and overall new orders eased, helped by signs of firmer domestic demand.
- The eurozone manufacturing PMI slightly improved in February, despite the coronavirus outbreak and its impact on supply chains.
- Japanese Prime Minister Shinzo Abe said Tuesday he wants to use up the remaining fiscal 2019 reserve funds totaling 270 billion yen for a second batch of emergency measures to contain the spread of the novel coronavirus
In early trade on Tuesday, the euro has marginally slipped against the US dollar to trade at $1.1133, while it has weakened 0.2% against the British pound to trade at GBP0.8715.
The below useful link, takes you to an active by the minute update on the Coronavirus. The plus on the left side of the page shows a drop down summary of Countries / stats.