By the close of Trade on Tuesday, the South African rand had strengthened against the US dollar.

  • The world’s richest nations prepared more costly measures on Tuesday to combat the global fallout of the coronavirus that has infected tens of thousands of people, triggered social restrictions unseen since World War Two and sent economies spinning toward recession. With the highly contagious respiratory disease that originated in China racing across the world to infect more than 196,000 people so far, governments on every continent have implemented draconian containment measures from halting travel to stopping sporting events and religious gatherings.
  • The greenback lost ground, as treasury yields slipped following the Fed’s interest rate cut.  The White House is seeking a stimulus package worth anywhere from $850 billion to over $1 trillion as the Trump administration looks to battle the economic impact from the coronavirus pandemic.  U.S. Treasury Secretary Steven Mnuchin warned Republican senators on Tuesday that the country’s unemployment rate could hit 20% if they failed to act on a proposed coronavirus rescue package and there was lasting economic damage
  • On the data front, US retail sales unexpectedly fell by the most in more than a year in February and the coronavirus pandemic is expected to depress sales in the months ahead.
  • Business inventories fell in line with market expectations in January.
  • The NAHB housing market index slightly dipped in March.
  • On the flipside, industrial production rose more-than-expected on a monthly basis in February.
  • Separately, the Fed and the White House took further steps to boost liquidity and stem damage from the coronavirus outbreak that has gripped the global economy.
  • The yield on benchmark government bonds ended mixed yesterday. The yield on 2021 bond declined to 5.87% while that for the longer-dated 2030 issue rose to 10.72%.

In early trade on Wednesday, the US dollar is trading 0.3% lower against the South African rand at R16.5766, while the euro is trading marginally higher at R18.2792.  The British pound has gained 0.4% against the South African rand to trade at R20.0833.  At the time of penning this report the Rand had slid to R16.72

By the close of trade on Tuesday, the euro declined against most of the major currencies.

  • The U.K. government has announced a raft of new financial measures to help businesses under strain from the coronavirus outbreak.
  • German economic sentiment in March fell to levels last seen at the beginning of the world financial crisis in autumn 2008, due to concerns regarding the impact of the coronavirus outbreak on Europe’s largest economy.  Meanwhile Germany has imposed strict Border measures.
  • A separate gauge measuring investors’ assessment of the economy’s current conditions dropped more-than-expected in March.
  • Meanwhile, the eurozone economic sentiment index plunged in March, affected by the coronavirus pandemic.

In early trade on Wednesday, the euro advanced 0.3% against the US dollar to trade at $1.1027, while it has weakened 0.2% against the British pound to trade at GBP0.9102.

NOVEL CORONAVIRUS STATS

198,348 confirmed cases   [15 798 new cases]

7,979 reported deaths  [821 new deaths]

67,003 recovered*   [0 change]

SA 85 cases [13 new]

Last updated 8:01am Mar 18, 2020