PANDEMIC – SA ON HIGH ALERT, SIMILAR TO A WAR FOOTING!
By the close of trade on Friday, the South African rand strengthened against the US dollar.
- In the US, the Michigan consumer sentiment index fell less than expected in early March as households responded to the coronavirus pandemic and a sharp stock market sell-off.
- The Fed cut interest rates to almost zero over the weekend in an emergency move and launched a massive $700.00bn quantitative easing program to shelter the economy from the effects of the virus. The Fed Chairman, Jerome Powell, stated that the epidemic was having a profound impact on the economy, forcing whole industries like travel and leisure offline and indicated that it was very hard to say how big the effects will be or how long they will last. Facing highly disrupted financial markets, the Fed also slashed the rate of emergency lending at the discount window for banks by 125 bps to 0.25%, and lengthened the term of loans to 90 days. The Fed also cut reserve requirement ratios for thousands of banks to zero.
- President Donald Trump has tested negative for coronavirus, just one day after he took the test and after multiple exposures to people who had contracted the disease.
- The yield on benchmark government bonds ended mixed on Friday. The yield on 2021 bond declined to 5.97% while that for the longer-dated 2030 issue rose to 9.97%.
In early trade on Monday, the US dollar is trading 0.3% higher against the South African rand at R16.3214, while the euro is trading 0.6% higher at R18.1552. The British pound has gained 0.9% against the South African rand to trade at R20.1518.
By the close of trade on Friday, the euro declined against most of the major currencies.
- In the UK, the Bank of England (BoE) minutes from emergency policy meeting showed that the central bank has the option to cut interest rates further and ramp up asset purchases to help lessen the economic shock of the coronavirus outbreak.
In early trade on Monday, the euro has advanced 0.1% against the US dollar to trade at $1.1121, while it has weakened 0.3% against the British pound to trade at GBP0.9011.
Summary of State of Emergency:
- National state of disaster declared . Rapid effective response system
- Limit contact with infected
- Travel ban on foreigners from high risk countries as of 18th March. Visas cancelled.
- SA residents to avoid travel to high risk countries.
- Travel alerts will be issued based in risk level.
- SA citizens returning from high risk area self quarantine.
- Medium risk country travel to be subjected to testing.
- 72 ports of entry . 35 to be shut down. 2 sea port to be closed .
- Domestic travel discouraged.
- Gathering of more than 100 prohibited.
- Small gathering organizer must have a plan.
- Schools to close on Wed 18thMarch 2020 till after Easter holidays.
- Tertiary institutions to be consulted.
- All businesses to ensure they intensify measures re hygiene control.
- Shopping malls to ensure hygiene control measures.
- Increase capacity of hospitals.
- Monitoring system
- Mass campaign to educate.
- Minimize physical contact.
- Funding available to reinforce the systems introduced.
- National Command Council to meet 3 x per week.