LOCKDOWN ADJUSTED LEVEL 3 Ver1 [ DAY 32]  

Wave 2 NEW VARIANT

TOTAL DAYS 312 – 07 HOURS 30 MINUTES

By the close of trade on Friday, the South African rand strengthened against the US dollar.

  • China on Friday executed a former top banker accused of taking $260 million worth of bribes, as well as other forms of corruption and bigamy, state media outlets reported. Lai Xiaomin was an infamous figure, a high-ranking party official and the former chairman of Huarong – one of the country’s largest state-controlled asset management firms. Lai was given a death term on January 5 by Tianjin No.2 Intermediate People’s Court after he confessed and all the money and property he accumulated over many years – said to be a record sum – was seized by state officials. Lai appealed for leniency but this was rejected.
  • Aung San Suu Kyi, leader of Myanmar’s governing National League for Democracy (NLD) party, has been arrested, a party spokesman said. It comes amid tensions between the civilian government and the military, stoking fears of a coup. At elections in November, the NLD won enough seats to form a government, but the army says the vote was fraudulent. Myanmar, also known as Burma, was ruled by the military until 2011. Ms Suu Kyi spent many years under house arrest. The newly elected lower house of parliament was due to convene for the first time on Monday but the military was calling for a postponement.
  • Over the weekend China released a pair of PMI reports that could offer investors some insight into the state of its economy and shed a little light on the conditions of the global economy. China’s factory recovery slowed in January as COVID-19 returned and growth in China’s services sector slowed in January. In January, mainland China reported more than 2,000 local cases of the coronavirus. While the number was small compared to other countries, authorities were concerned about transmission risks during the Lunar New Year travel rush the world’s biggest annual human migration spanning 40 days from January to February.
  • U.S. Treasury Secretary Janet Yellen and her Canadian counterpart on Friday underscored the importance of working closely together on economic policy, national security and climate change, the governments said in separate statements. Yellen spoke with Canadian Deputy Prime Minister and Finance Minister Chrystia Freeland about a range of issues, including efforts to mitigate the impact of the COVID-19 pandemic and the importance of the bilateral trade relationship, Treasury said in a statement.
  • Data indicated that South Africa reported its eighth consecutive monthly trade surplus in December.
  • Moreover, South African Reserve Bank Governor, Lesetja Kganyago stated that there is room for further stimulus should the country experience a third wave of COVID-19.
  • In the US, on the data front, consumer spending fell in December, amid renewed business restrictions to slow the spread of COVID-19 and a temporary expiration of government-funded benefits for millions of unemployed people.
  • Pending home sales decreased for a fourth straight month in December, weighed down by a shortage of houses available for sale.
  • The yield on benchmark government bonds fell on Friday. The yield on 2026 bond fell to 6.68%. Further, the yield on 2023 bond advanced to 4.63%, while that for the longer-dated 2030 issue fell to 8.72%.

In early trade on Monday, the US dollar is trading lower against the South African rand at R15.1252, while the euro is trading lower at R18.3442.  The British pound has declined  against the South African rand to trade at R20.7628.

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

  • The latest PMI data pointed to a renewed deterioration in operating conditions across the Japanese manufacturing sector in January. Survey respondents registered a fall in output in the latest survey period, following a broad stabilisation seen in December, as rising coronavirus disease 2019 (COVID-19) cases had a renewed impact on the economy. That said, Japanese manufacturers reported a stable trend in new business inflows for the first time in over two years, as some businesses anticipated a recovery in demand in 2021.
  • Matteo Renzi, who triggered Italy’s political crisis this month by pulling his Italia Viva party out of the ruling coalition, would like to see former European Central Bank chief Mario Draghi become prime minister, a party source said on Sunday. The former coalition allies are holding talks to try and overcome their differences and revive their government, which formally collapsed last week when Prime Minister Giuseppe Conte resigned.
  • German unemployment fell unexpectedly in January, signaling that government incentives for companies to keep workers on their payroll during the coronavirus pandemic were shielding the labour market in Europe’s biggest economy.
  • German gross domestic product rose in 4Q20, driven by robust exports despite a second wave of the COVID-19 pandemic.

In early trade on 1st February 2021, the euro has marginally slipped against the US dollar to trade at $1.2166, while it has weakened  against the British pound to trade at GBP0.8851.

TECHNICAL:

 USD to ZAR Stats

Stats Data Last 30 days Last 90 days
High 15.5286 16.0231
Low 14.6571 14.5379
Average 15.1340 15.1444
Volatility 0.98% 0.76%

GBP to ZAR Stats

Stats Data Last 30 days Last 90 days
High 20.9990 21.0204
Low 19.9656 19.5556
Average 20.6442 20.3579
Volatility 0.82% 0.72%

EUR to ZAR Stats

Stats Data Last 30 days Last 90 days
High 18.9467 18.9467
Low 17.9139 17.7636
Average 18.4151 18.2810
Volatility 0.9% 0.7%

 AUD to ZAR Stats

Stats Data Last 30 days Last 90 days
High 11.9967 11.9967
Low 11.2827 11.0639
Average 11.6781 11.3932
Volatility 0.88% 0.71%

 MUR to ZAR Stats

Stats Data Last 30 days Last 90 days
High 0.39420 0.40189
Low 0.36778 0.36619
Average 0.38247 0.38136
Volatility 1.08% 0.99%

 CNY to ZAR Stats

Stats Data Last 30 days Last 90 days
High 2.39668 2.39959
Low 2.24499 2.22446
Average 2.33812 2.31734
Volatility 0.94% 0.74%

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LOCKDOWN ADJUSTED LEVEL 3 Ver1 [ DAY 27]  

Wave 2 NEW VARIANT

TOTAL DAYS 307 – 07 HOURS 30 MINUTES

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

  • Investors continued to weigh the benefits of fiscal stimulus and coronavirus vaccine rollouts over concerns about second and third wave coronavirus infections.  Biden knows only too well that the bigger you are, the harder you fall and this is what is behind his $1.9 trillion dollar rescue package for the economy and for tackling COVID-19 head on. He literally took hours to get his act together.
  • In the US, consumer confidence rose in January, despite lingering concerns about the COVID-19 pandemic leading to a further deterioration in US households’ perceptions of the labour market.
  • Federal Reserve Chairman Jerome Powell faces a tough question when he approaches the podium on Wednesday: is it a better strategy to provide more or less communication on the Fed’s asset purchase program? On interest rate policy, the Fed is expected to hold rates at near-zero as the economic focus shifts to the vaccine rollout and President Joe Biden’s efforts on further stimulus. “We expect little news from the FOMC meeting, with the FOMC hesitant to show much pessimism about current growth or too much optimism about the impacts of vaccines or additional fiscal policy
  • On global front, the International Monetary Fund has become more upbeat about the global economy, as coronavirus vaccinations are administered across the world.
  • The yield on benchmark government bonds mostly rose yesterday. The yield on 2026 bond rose to 6.68%. Further, the yield on 2023 bond advanced to 4.56% while that for the longer-dated 2030 issue fell to 8.77%.

In early trading on Wednesday, the US dollar is trading higher against the South African rand at R15.0822, while the euro is trading higher at R18.3366.  The British pound has marginally gained against the South African rand to trade at R20.7129.

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

  • European Central Bank policy makers have agreed to look deeper into the euro’s appreciation against the dollar since the start of the pandemic, focusing on whether it’s driven by differences in stimulus policies compared with the U.S., according to officials familiar with the matter. The review could shape how the ECB responds to an issue that has alarmed policy makers, who worry that the euro’s strength over the past year depresses inflation that is already below zero. That could force the central bank to provide more monetary stimulus, even as it acknowledges mounting risks to financial stability.
  • In the UK, unemployment rate rose in November to its highest level in four years, on account of rising coronavirus infections.  Retail prices have plunged further this month as post-Christmas sales and shop closures caused retailers to discount stock heavily, according to new figures. The BRC-Nielsen Shop Price Index for January has revealed that prices slid by 2.2%, as deflation accelerated from 1.8% in December. The slump was driven by a sharp decline in the price of non-food items during the month. Non-food prices slid by 3.6% in January, compared with a 3.2% fall in the previous month.
  • Bank of Japan Governor Haruhiko Kuroda said Tuesday the state of Japan’s fiscal health is “very serious” but denied the central bank is financing the government’s budget with its massive purchases of government bonds. “I personally think Japan’s fiscal situation is very serious,” Kuroda, who has rarely commented on fiscal conditions, said during a parliamentary committee session, at a time when the government is relying on massive bond issuances to finance stimulus measures and support the pandemic-hit economy. In fiscal 2021 starting in April, the government plans to issue 236.01 trillion yen ($2.3 trillion).

In early trade on Wednesday, the euro has marginally slipped against the US dollar to trade at $1.2137, while it has marginally gained against the British pound to trade at GBP0.8822.

 COVID NEWS:

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Provincial

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LOCKDOWN ADJUSTED LEVEL 3 Ver1 [ DAY 26]  

Wave 2 NEW VARIANT

TOTAL DAYS 306 – 07 HOURS 35 MINUTES

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

  • Chinese President Xi Jinping warned that a “new cold war” could turn hot, and must be avoided, in a speech on Monday at World Economic Forum’s virtual “Davos Agenda” conference. Why it matters: Xi didn’t refer directly to U.S.-China tensions, but the subtext was clear. These were his first remarks to an international audience since the inauguration of President Biden, whose administration has already concurred with Donald Trump’s determination that China is committing “genocide” against Uyghur Muslims, and issued a warning about China’s aggression toward Taiwan.
  • The Federal Reserve this week will likely underscore its commitment to its low-interest rate policies, even as the economy recovers further from the devastation of the viral pandemic. Chair Jerome Powell is sure to strike a dovish tone at a news conference after the Fed’s latest policy meeting ends Wednesday. He may, in particular, aim to puncture any speculation that the Fed might soon curtail its aggressive efforts to support the economy, including its bond purchase program that aims to hold down long-term interest rates.
  • The Senate voted 84-15 to confirm Janet Yellen as Treasury secretary on Monday. Why it matters, Yellen is the first woman to serve as Treasury secretary, a Cabinet position that will be crucial in helping steer the country out of the pandemic-induced economic crisis. Yellen previously served as first female chair of Council of Economic Advisers under President Clinton and first female chair of the Federal Reserve under President Obama.  Her confirmation as Treasury secretary makes her the first person to have held all three economic power positions in the federal government.
  • In SA, President Cyril Ramaphosa stated at an African National Congress national executive meeting that the party had agreed that the government should consider basic income relief for unemployed people, though this would depend on state finances.
  • Moderna said Monday it’s accelerating work on a Covid-19 booster shot to guard against the recently discovered variant in South Africa. Its researchers said its current coronavirus vaccine appears to work against the two highly transmissible strains found in the U.K. and South Africa, although it looks like it may be less effective against the latter. The two-dose vaccine produced an antibody response against multiple variants, including B.1.1.7 and B.1.351, which were first identified in the U.K. and South Africa, respectively.
  • The yield on benchmark government bonds rose yesterday. The yield on 2026 bond rose to 6.67%. Further, the yield on 2023 bond advanced to 4.56% while that for the longer-dated 2030 issue rose to 8.78%.

In early trade on Tuesday, the US dollar is trading higher against the South African rand at R15.2633, while the euro is trading higher at R18.5464.  The British pound has gained against the South African rand to trade at R20.8826.

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

  • Wall Street is pinning its bets of an economic rebound this year on mass vaccinations and a virus brought under control, but new coronavirus strains threaten that sunny outlook, a number of firms are warning. Why it matters: None downgraded growth forecasts because of the variants, but they’re acknowledging there’s a new asterisk to the anticipated economic recovery. Driving the news: British Prime Minister Boris Johnson said Friday the country’s more contagious variant is also more deadly.
  • A strong second-half global recovery, revived inflation and resurfacing of concerns over indebtedness in the euro area are in store in 2021, according to an OMFIF review of New Year prospects by German and US experts. The world will find a path back to multilateralism under President Joe Biden, but tensions over China between the US and Europe will continue, complicated by the German leadership change as Chancellor Angela Merkel makes her scheduled departure after the September general election.
  • German business morale slumped to a six-month low in January, as a second wave of COVID-19 infections halted recovery in Europe’s largest economy.
  • German Chancellor Angela Merkel and U.S. President Joe Biden agreed in a phone call on Monday that the COVID-19 pandemic and other global challenges can only be tackled through closer cooperation, a government spokesman in Berlin said on Monday. Transatlantic relations cooled sharply under former President Donald Trump, who attacked Germany repeatedly for its export strength and its relatively low defense spending within the NATO alliance. After bruising meetings of the G7 group of wealthy nations and NATO with Trump in 2017, Merkel said Europe could no longer completely rely on its allies
  • UK businesses have claimed government officials are encouraging them to set up new hubs in the EU to avoid Brexit trade disruption. The firms say they were advised to establish subsidiaries in the bloc by both the Department of International Trade (DIT) and the Department for Environment, Food and Rural Affairs (Defra) after being hit by extra charges, taxes and paperwork.

In early trade on Tuesday, the euro has marginally slipped against the US dollar to trade at $1.2142, while it has gained against the British pound to trade at GBP0.8922.

COVID NEWS:

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Provincial

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LOCKDOWN ADJUSTED LEVEL 3 Ver1 [ DAY 25]  

Wave 2 NEW VARIANT

TOTAL DAYS 305 – 07 HOURS 35 MINUTES

By the close of trade on Friday, the South African rand weakened against the US dollar. Time zones mean that most mornings Asia looks West to see which direction markets should initially travel, and on Mondays, that means looking to Friday’s US and European closing prices. Today, they don’t paint a happy picture, with headline stock indices such as the S&P500 finishing lower, and the NASDAQ essentially flat.

  • New coronavirus restrictions dented investor optimism about US President, Joe Biden’s plans to increase fiscal stimulus measures in the world’s biggest economy.   One of President Joe Biden’s top economic aides on Sunday will press Democratic and Republican senators for a fresh $1.9 trillion in coronavirus relief to help struggling Americans and avert a larger economic crisis. Brian Deese, Director of the National Economic Council, said he would speak to the senators to make the case for a large rescue plan. “We can’t wait,” White House spokesperson Karine Jean-Pierre told reporters. “Just because Washington has been gridlocked before doesn’t mean it needs to continue to be gridlocked.”
  • In the US, on the data front, manufacturing activity surged to its highest level in nearly 14 years in early January.
  • Existing home sales unexpectedly rose on a monthly basis in December, but surging house prices amid record-low inventory could slow the housing market momentum in the coming months.
  • The Chinese economy brought in more foreign direct investment than any other country last year, knocking the United States from its perch atop the list. China brought in $163 billion in inflows last year, compared to $134 billion attracted by the U.S., the United Nations Conference on Trade and Development wrote in a report released on Sunday. In 2019, the U.S. received $251 billion in inflows and China received $140 billion. Overall, the report found that foreign direct investment tanked globally, as the Covid-19 pandemic brought countries large and small to virtual stand-stills.
  • The yield on benchmark government bonds rose on Friday. The yield on 2026 bond rose to 6.66%. Further, the yield on 2023 bond advanced to 4.54%, while that for the longer-dated 2030 issue rose to 8.75%.

In early trade on Monday, the US dollar is trading lower against the South African rand at R15.1242, while the euro is trading lower at R18.4222.   The British pound has marginally declined against the South African rand to trade at R20.7221.

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

  • Germany’s services sector shrank for the fourth month in a row in January, as a hard lockdown shuttered most non-essential businesses as well as schools in Europe’s biggest economy.
  • Manufacturing remained in expansion territory as exports kept German factories bustling.
  • Economic activity in the eurozone shrank significantly in January, as stringent lockdowns to contain the coronavirus pandemic hit the bloc’s dominant service industry hard.
  • Saudi Arabia’s king appointed Fahad al-Mubarak as central bank governor, his second stint in one of the most sensitive positions in the kingdom replacing Ahmed al-Kholifey, a decree carried on state media on Sunday said. Mubarak, who had helmed the Saudi Central Bank (SAMA) from 2011-2016, was previously chairman and managing director of Morgan Stanley, Saudi Arabia, and has also served as chairman of the Saudi stock exchange. He was succeeded as governor in 2016 by Kholifey, who guided SAMA during a sharp economic contraction last year caused by lower crude prices and COVID-19.
  • Mexican President Andrés Manuel López Obrador said Sunday he has tested positive for COVID-19 and that the symptoms are mild. Mexico’s president, who has been criticized for his handling of his country’s pandemic and for not setting an example of prevention in public, said on his official Twitter account that he is under medical treatment. “I regret to inform you that I am infected with COVID-19,” he tweeted.
  • Japanese Prime Minister Yoshihide Suga faced renewed pressure on Monday over his handling of the coronavirus pandemic, with a new opinion poll showing many believed the government was too slow to respond to the latest wave of infections. Opposition lawmakers were also increasingly frustrated with Suga’s taciturn leadership style, demanding he provide detailed answers to questions about the COVID-19 crisis and the Tokyo Olympics set to start in less than six months. Suga is struggling to halt a steady decline in support for his four-month-old government even after launching a raft of measures to contain a third wave.

In early trade on Monday, the euro has marginally advanced against the US dollar to trade at $1.2166, while it has weakened against the British pound to trade at GBP0.8892.

 COVID NEWS:

Vaccine Update: As of Sunday, Bloomberg estimates that the U.S. has given 21.1 million doses of vaccine have been delivered while the rate of vaccination now exceeds 1 million per day.

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LOCKDOWN ADJUSTED LEVEL 3 Ver1 [ DAY 22]  

Wave 2 NEW VARIANT

TOTAL DAYS 302 – 07 HOURS 35 MINUTES

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

  • The SARB’s monetary policy committee kept its key interest rates on hold for the third time in a row. The central bank, however, was more upbeat about growth, revising its forecasts for GDP in 2021 to 3.6% and predicting an expansion of 2.4% in 2022. That is up from its November forecasts of 3.5% in 2021 and 2.4% in 2022.
  • Meanwhile, in the US, the number of people filing new applications for unemployment benefits decreased modestly for the week ended 16 January.
  • Amid her 114 pages of written follow-up responses to her Senate confirmation hearing, Treasury Secretary-designate Janet Yellen touched on various topics spanning from climate change to sanctions policy and moves to maintain the dollar’s status as the world’s main reserve currency, telling lawmakers that she will work with President Joe Biden to get countries to refrain from currency manipulation. “The president has committed to opposing efforts by countries to artificially manipulate their currencies to gain an unfair trade advantage.   Yellan wasted no time telegraphing Joe Biden’s plans to be tough on China. Events at BlackRock Inc, though, demonstrate how much of an uphill slog the new president faces. As Donald Trump exited the White House, news dropped that the US investment giant had vacated the top spot for exchange-traded funds tracking onshore stocks. The new number one in the space? China Asset Management (Hong Kong) Ltd. Such funds are popular with China bulls amid US sanctions and other clampdowns on China.
  • Nearly 3 million Americans appear to have fallen off the unemployment benefits cliff after Christmas, a scenario many had feared amid delays in pushing through another Covid relief bill. Jobless benefits offered through two temporary CARES Act programs were set to lapse the last weekend in December a “cliff” that would immediately deny income support to millions of workers absent federal intervention. Congress scrambled to pass a pandemic aid measure, after months of failed negotiations, to prevent that outcome. Legislators passed a $900 billion package on Dec. 21.
  • The yield on benchmark government bonds mostly rose yesterday. The yield on 2026 bond rose to 6.63%. Further, the yield on 2023 bond advanced to 4.51% while that for the longer-dated 2030 issue fell to 8.71%.

In early trade on Friday, the US dollar is trading higher against the South African rand at R15.0022, while the euro is trading higher at R18.2526.  The British pound has gained against the South African rand to trade at R20.5672.

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

  • Asian stock markets are mixed on Friday after U.S. President-elect Joe Biden revealed details of a $1.9 trillion stimulus proposal, called the American Rescue Plan, to support American households and businesses amid the pandemic. Worries about rising U.S.-China tensions weighed on the markets after the Trump administration placed Chinese smartphone maker Xiaomi on a blacklist of companies with alleged ties to the Chinese military. The Australian market is extending gains from the previous session.
  • The European Central Bank (ECB) kept its interest rate unchanged but warned that the recent surge in COVID-19 infections posed a risk to the eurozone’s recovery, while reaffirming its pledge to keep borrowing costs at record lows to help the regional economy weather the pandemic.
  • The ECB President, Christine Lagarde stated that the coronavirus pandemic is still posing “serious risks” to the eurozone economy.
  • Japan’s factory activity slipped into contraction in January and the services sector was more pessimistic, a private-sector survey showed on Friday, as emergency measures taken in response to a resurgence of COVID-19 infections hurt sentiment. Japanese Prime Minister Suga this month announced a second state of emergency in the country to stem a rise in coronavirus cases, which now covers Tokyo, Osaka, Kyoto and other areas accounting for 55% of the nation’s population. The au Jibun Bank Flash Japan Manufacturing Purchasing Managers’ Index (PMI) fell to 49.7 from a final 50.0 in December

In early trade on Friday, the euro has advanced against the US dollar to trade at $1.2162, while it has gained against the British pound to trade at GBP0.8848.

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