LOCKDOWN LEVEL 1 Ver1 [ DAY 8]  

TOTAL DAYS 348 – 7 HOURS 40 MINUTES

Vaccine rollout day 36 / J & J VACCINE DAY 24      

By the close of trade on Friday 5th march 2021, the South African rand weakened against the US dollar.

  • In the US, the economy created more jobs than expected in February as falling new COVID-19 infections and additional pandemic relief money from the government boosted hiring at restaurants and other services businesses.
  • The White House on Sunday urged computer network operators to take further steps to gauge whether their systems were targeted amid a hack of Microsoft Corp’s Outlook email program, saying a recent software patch still left serious vulnerabilities. “This is an active threat still developing and we urge network operators to take it very seriously,” a White House official said, adding that top U.S. security officials were working to decide what next steps to take following the breach.
  • Friday’s US market was the proverbial game of two halves, 10-year US Treasury yields making a new year-to-date high immediately following the stronger than expected 379k jump in US non-farm payrolls, and this is turn hurting equities at the open and supporting the USD. Yet equities stages an impressive afternoon come-back, in conjunction with Treasury yield falling back to end the day little changed, the S&P 500 up 3% from intra-day low to high to finish +2.0% and the NASDAQ and even more impressive 4% intra-day swing to end +1.6%. The BBDXY USD index gained 0.35% Friday to be up just under 1% on the week
  • Unemployment rate fell in February.  The trade deficit widened in January as goods imports jumped to a record high amid a sharp rebound in consumer spending.
  • Senate Democrats passed their version of the near-$1.9 trillion American Rescue Plan Act Saturday afternoon, but not before making some major changes from the version of the bill passed by the House of Representatives last week. Some of the most notable changes between the two relief bills include dropping a provision to gradually increase the minimum wage to $15 per hour and reducing the number of people who will qualify for a $1,400 stimulus payment.
  • U.S. Secretary of State Antony Blinken called for a 90-day reduction in violence in Afghanistan and a new United Nations-led peace effort as he warned the United States could withdraw all forces after May 1, according to a letter to Afghan President Ashraf Ghani reported by several news outlets Sunday.
  • The yield on benchmark government bonds rose on Friday. The yield on 2026 bond rose to 7.57%. Further, the yield on 2023 bond advanced to 5.37% while that for the longer-dated 2030 issue rose to 9.29%.

In early trade on Monday, the US dollar is trading higher against the South African rand at R15.3822, while the euro is trading marginally lower at R18.3233.  The British pound has declined against the South African rand to trade at R21.2472.

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

  • A busy week ahead for European economics with the ECB press conference and rate statement. Are changes to economic policy coming to halt steepening yields? In the US, CPI data is released, gauging the effects of inflation. The Bank of Canada will also be making its overnight rate statement, and a strong economic outlook for Canada could mean a change in bond-buying policy.
  • The United Kingdom lost market share in the United States, Germany and China during the COVID-19 pandemic due to global trade chaos, Brexit and poor productivity, according to new research published on Monday. The United Kingdom performed particularly badly due to a long-term stagnation in productivity growth, according to the report by Aston University’s Lloyd’s Banking Group Centre for Business Prosperity. While all countries grappled with the tumult of COVID-19, the United Kingdom lost market share in its biggest export markets – the United States and Germany, the research showed.
  • German factory orders rose more than expected in January as robust foreign demand more than offset domestic weakness in Europe’s largest economy.

In early trade on Monday, the euro has slipped against the US dollar to trade at $1.1926, while it has gained against the British pound to trade at GBP0.8626.

 COVID NEWS:

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Provincial

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LOCKDOWN LEVEL 1 Ver1 [ DAY 4]  

TOTAL DAYS 344 – 7 HOURS 30 MINUTES

Vaccine rollout day 32 / J & J VACCINE DAY 20      

By the close of trade on Thursday 3rd March 2021, the South African rand weakened against the US dollar.

  • Federal Reserve Chairman Jerome Powell said Thursday that he expects some inflationary pressures in the time ahead but they likely won’t be enough to spur the central bank to hike interest rates. “We expect that as the economy reopens and hopefully picks up, we will see inflation move up through base effects,” Powell said during a Wall Street Journal conference.
  • The number of people filing new claims for unemployment benefits rose for the week ended 26 February, boosted by brutal winter storms in the densely populated South in mid-February, though the labour market outlook is improving amid declining new COVID-19 cases.
  • Factory orders increased more than expected in January, pointing to a sustained recovery in manufacturing even as the pace of business spending on equipment is slowing.
  • The U.S. will bolster its conventional deterrence against China, including establishing a network of precision-strike missiles along the so-called first island chain and will request a combined $27.4 billion over the next six years for the Indo-Pacific theater, Nikkei has learned. They form the core proposals of the Pacific Deterrence Initiative that the U.S. Indo-Pacific Command has submitted to Congress and which Nikkei has reviewed. “The greatest danger to the future of the United States continues to be an erosion of conventional deterrence,” the document said.
  • China announced on Friday a growth target of over 6 percent for its economy for 2021, picking up the decades-long tradition of releasing a numeric goal after skipping it in 2020 due to the COVID-19 pandemic, showcasing top policymakers’ solid confidence on the world’s second-largest economy to sustain a robust recovery despite internal and external risks. The growth target of over 6 percent is largely in line with a widely accepted forecast of over 8 percent for the year.
  • The yield on benchmark government bonds rose yesterday. The yield on 2026 bond rose to 7.39%. Further, the yield on 2023 bond advanced to 5.26% while that for the longer-dated 2030 issue rose to 9.15%.

In early trade on Friday, the US dollar is trading marginally higher against the South African rand at R15.3122, while the euro is trading marginally lower at R18.3136.  The British pound has gained against the South African rand to trade at R21.2822.

By the close of business on Thursday, the euro declined against most of the major currencies.

  • Tsunami imminent.  New Zealand people living in the tsunami danger zone urged to follow evacuation routes to higher ground immediately.  This threat level was downgraded and evacuees were permitted to return to their homes.  More info on the National Emergency Management Agency website: https://civildefence.govt.nz   In Covide-19 news, Auckland will move to alert level 2 and the rest of New Zealand will move to level 1 at 6am on Sunday morning, Prime Minister Jacinda Ardern has announced. Ardern announced the move while speaking to media after a Cabinet meeting to decide on alert level changes.
  • the eurozone retail sales fell more than expected on a monthly basis in January.  Sluggish pace of vaccination continues to jeopardise the recovery in the eurozone. At the end of February, less than 5% of the population in the eurozone had received at least one dose of one of the vaccines. With Johnson & Johnson most probably able to step into the game from April onwards, supply constraints will ease, but the vaccination process also needs an urgent makeover in many countries if herd immunity is to be reached over the course of this year.
  • The Securities and Exchange Commission today announced an award of over $5 million to joint whistleblowers whose tip caused the opening of an investigation that resulted in a successful enforcement action. The whistleblowers provided significant information about misconduct abroad that directly supported certain allegations in the enforcement action. “The whistleblowers’ information alerted the staff to misconduct occurring abroad which could have been difficult to detect without their tip,” said Jane Norberg, Chief of the SEC’s Office of the Whistleblower.

In early trade on Friday, the euro has slipped against the US dollar to trade at $1.1960, while it has weakened against the British pound to trade at GBP0.8606.

COVID NEWS:

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Provincial

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LOCKDOWN LEVEL 1 Ver1 [ DAY 2]  

TOTAL DAYS 341 – 7 HOURS 25 MINUTES

Vaccine rollout day 29 / J & J VACCINE DAY 16      

By the close of trade on Monday1st March 2021, the South African rand strengthened against the US dollar.

  • South Africa’s seasonally adjusted Absa Purchasing Managers’ Index (PMI) expanded at a faster pace in February, supported by an increase in new sales and business activity.
  • In the US, ISM Manufacturing PMI increased to a three-year high in February, amid a surge in new orders, but factories continued to face higher costs for raw materials and other inputs amid labour shortages as the COVID-19 pandemic drags on.
  • Federal Reserve Board Governor, Lael Brainard stated that the coronavirus pandemic laid bare a number of weaknesses in the financial system that should be addressed with new rules to prepare for the next shock.
  • The Biden administration is preparing to impose sanctions against Russia over the poisoning and jailing of opposition leader Alexey Navalny, according to three congressional aides briefed on the plans. The sanctions will be unveiled as early as Tuesday, the aides said, offering no specifics and describing the moves on condition of anonymity ahead of a formal announcement. The measures will involve the State, Treasury and Commerce Departments, according to one aide.
  • The yield on benchmark government bonds fell yesterday. The yield on 2026 bond fell to 7.24%. Further, the yield on 2023 bond declined to 5.20%, while that for the longer-dated 2030 issue fell to 8.96%.

In early trade on Tuesday, the US dollar is trading higher against the South African rand at R15.0527, while the euro is trading marginally higher at R18.1022.  The British pound has marginally declined against the South African rand to trade at R20.8936.

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

  • The Chinese embassy in Britain on Monday expressed grave concern over and strong opposition to British Foreign Secretary Dominic Raab’s wrong remarks about Hong Kong. “The UK side’s remarks confuse right and wrong, and interfere in China’s internal affairs and judicial sovereignty. The Chinese side expresses its grave concern and strong opposition,” said a spokesperson for the embassy in a statement. Over a recent decision to charge 47 people, the statement said the handling of this case by the Hong Kong judicial authorities is in line with the law and brooks no distortion or discredit.
  • Australia has been riding the recent commodities boom. And if a super cycle does develop, it could be in for some substantial growth. But, there is a particular challenge that they have to overcome in the short term, which might put it behind other countries during the recovery. Australia was one of the slowest countries in the developed world to begin their COVID-19 vaccination program. In fact, the first jabs only started on Feb 22. Australia has secured orders for more than enough vaccines for their population. However, their schedule is more extensive than other nations.
  • Central banks need to be prepared to act on inflation moving in either direction, according to former Bank of England Governor Mervyn King, who warned against excessive confidence that price growth will remain low. The recent rise in bond yields indicates that markets are aware of the risks, King said in a Bloomberg Television interview Monday.
  • The eurozone factory activity increased in February, on account of soaring demand, although the burst of business led to a shortage of raw materials and a spike in input costs.
  • German manufacturing PMI rose to its highest level in more than three years in February, brightening the outlook for Europe’s largest economy.
  • Crude oil futures rallied in the Asian session before paring gains as the European session progressed as traders look ahead to the OPEC+ meeting this week. OPEC and allies meet on March 4th with market participants looking at a likely lower of output constraints.

In early trade on Tuesday, the euro slipped against the US dollar to trade at $1.2066, while it has gained against the British pound to trade at GBP0.8692.

COVID NEWS:

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Provincial

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LOCKDOWN LEVEL 1 Ver1 [ DAY 1]  

TOTAL DAYS 341 – 7 HOURS 45 MINUTES

Vaccine rollout day 28 / J & J VACCINE DAY 15      

By the close of busines on Friday 26th February 2021, the South African rand weakened against the US dollar.

  • President Ramaphosa took to his 3 weekly Television slot, to announce to the Republic that were now over the second wave and that we were now on an Alert level 1 with softened restrictions and shorter curfew.
  • Israel hit several Iranian targets as Iranian rebels targeted an IDF warship in the sea of Oman.  The Iranians have also rebuffed the US attempts to get around the nuclear negotiating table. A spokesman for Iran’s Foreign Ministry said on Sunday that conditions are not ripe for informal nuclear talks between Iran, the U.S. and other world powers. The Biden administration had proposed the talks as part of its efforts to negotiate a path back to the 2015 nuclear deal. The White House expressed disappointment with Iran’s response, but said it remained willing to engage with Tehran. Temperatures in the region are nearing boiling point.
  • Concerns that domestic inflation could begin rising too quickly as more stimulus is pumped into the economy, even as the recovery from the coronavirus pandemic seems on track.
  • In the US, trade deficit widened in January. More than 150 top business executives from some of the largest American companies across multiple industries voiced their support for President Joe Biden’s $1.9 trillion relief package and $1,400 stimulus checks. In a letter addressed to bipartisan congressional leaders sent Wednesday, the group of senior executives urged Congress to “act swiftly” and approve more relief to help improve the U.S. economy. “Previous federal relief measures have been essential, but more must be done to put the country on a trajectory for a strong, durable recovery.
  • Meanwhile, consumer spending increased by the most in seven months in January, as the government doled out more pandemic relief money to low-income households and new COVID-19 infections dropped, thus positioning the economy for faster growth in the first quarter.
  • The yield on benchmark government bonds mostly rose on Friday. The yield on 2026 bond rose to 7.36%. Further, the yield on 2023 bond declined to 5.24%, while that for the longer-dated 2030 issue rose to 9.04%.

In early trade on Monday, the US dollar is trading lower against the South African rand at R15.0266, while the euro is trading lower at R18.15285.  The British pound has declined against the South African rand to trade at R21.0147.

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

  • Businesses in the Japanese manufacturing sector signalled the first improvement in operating conditions since April 2019 in February. The higher headline PMI® reading was supported by modest expansions in both output and new order inflows. That said, manufacturers commented that supply chain disruption caused by the coronavirus disease 2019 (COVID-19) pandemic contributed to a sharp rise in input prices. As a result, input cost inflation rose to the fastest for two years. Nonetheless, businesses remained optimistic that production would rise over the coming 12 months.
  • In the UK, the vaccination programme against COVID-19 entered a new phase as the National Health Service (NHS) will begin contacting all over-60s to book their jabs at the nearest vaccination centre or with a general practitioner (GP) or pharmacy.
  • Australia’s central bank signaled it will not shirk from its yield target and quantitative easing programs designed to hold down borrowing costs and keep a lid on the currency. Yet, the bond market shows no indication of taking a backward step. Reserve Bank Governor Philip Lowe and his board are likely to focus Tuesday’s meeting on their response to a global reflation trade that’s proving a major challenge for central banks.  Chinese investment in Australia plunged almost two-thirds last year to less than US$1 billion as the impact of coronavirus was compounded by increasingly fraught relations. The new figure marks the fourth straight annual drop and is just a fraction of the US$13 billion injected into the country in 2016, with Canberra growing increasingly wary. Data from the Australian National University (ANU) released on February 28 showed direct investment plunged to US$800 million last year, from just over US$2 billion in 2019.

In early trade on Monday, the euro advanced against the US dollar to trade at $1.2093, while it has weakened against the British pound to trade at GBP0.8622.

COVID NEWS:

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Provincial

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LOCKDOWN ADJUSTED LEVEL 3 Ver2 [ DAY 29]  

Wave 2 NEW VARIANT

TOTAL DAYS 336 – 7 HOURS 45 MINUTES

Vaccine rollout day 23 / J & J VACCINE DAY 10

By the close of trade on Wednesday 24th February 2021, the South African rand strengthened against the US dollar.

  • In the 2021 Budget speech, Finance Minister, Tito Mboweni reversed a decision to raise an extra R40.00bn ($2.80bn) over the next four years.
    • He also allocated funds for COVID-19 vaccines and set more ambitious debt-consolidation targets, while sticking to a pledge to freeze state workers’ wages.
    • Also, inflation-beating relief was announced for individuals, along with a 1 percentage point cut in corporate tax from April 2022.
    • Mboweni’s speech was dotted with light hearted humor and quotes from the ages.  Mboweni himself came up with a pearler “We must do more with less, in the hope that we can make more”.
    • SIN tax was prominent with a rise in alcohol
  • In the US, sales of new US single-family homes increased more-than-expected in January, boosted by historically low mortgage rates and an acute shortage of previously owned houses on the market.
  • Federal Reserve Chairman, Jerome Powell stated that the central bank would keep its attention focused on getting Americans back to work as a COVID-19 vaccine-related recovery proceeds.  It may take more than three years to reach the Federal Reserve’s inflation goals, a further signal the U.S. central bank plans to look beyond any post-pandemic spike in prices and leave interest rates unchanged for a long time to come. “We are just being honest about the challenge,” Powell told the House of Representatives Financial Services Committee when asked about Fed projections that inflation will remain at or below the central bank’s 2% target through 2023.
  • Also in the US, retail sales are expected to grow this year between 6.5% and 8.2%, amounting to more than $4.33 trillion in sales, as the U.S. economy begins to reopen, and more and more individuals receive the Covid vaccine, the National Retail Federation said Wednesday. A preliminary reading shows that retail sales grew 6.7% to $4.06 trillion last year, the industry’s leading trade group said. That was largely boosted by nearly 22% growth online. Over the course of the year, more Americans turned to websites and apps to buy groceries, comfortable clothing and home goods.
  • Democrats in the U.S. Senate have chosen to move forward with the next pandemic relief package using reconciliation. The arcane process that allows certain bills to circumvent the filibuster rules and pass with only 50 votes, not the typical 60. In light of this, Democrats have increased the estimate of the final size of the fiscal package to a range of $1.5 trillion to $1.9 trillion (likely closer to the higher end of that range). This means an increase in the U.S. growth forecasts for 2021.
  • The yield on benchmark government bonds mostly rose yesterday. The yield on 2026 bond rose to 7.13%. Further, the yield on 2023 bond advanced to 5.17%, while that for the longer-dated 2030 issue fell to 8.80%.

In early trade on Thursday, the US dollar is trading higher against the South African rand at R14.5326, while the euro is trading higher at R17.6671.  The British pound has gained against the South African rand to trade at R20.5466.

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

  • Bank of England officials brushed aside suggestions that the economy is about to suffer from higher inflation anytime soon as it struggles with the fallout of the coronavirus pandemic. Answering questions from lawmakers on Wednesday, policy makers said data monitored by the central bank don’t show evidence of inflation overshooting its 2% target. A surge in household savings under lockdown has fueled speculation of a rapid increase in consumer demand as the government starts to unwind virus restrictions next month.
  • German gross domestic product (GDP) rose more-than-market expectations, driven by strong exports and solid construction activity. However, stricter lockdown measures domestically and abroad are clouding the outlook for Europe’s largest economy.
  • China’s centrally-administered state-owned enterprises (SOEs) are making growth plans for the 14th Five-Year period (2021-2025), with a focus on high-quality development to underpin broader economic and social development. The growth targets of China’s central SOEs will be specified once the country’s 14th five-year plan for economic and social development is approved by the top legislature, said Hao Peng, chief of the State-owned Assets Supervision and Administration Commission (SASAC), at a press conference on Tuesday.

In early trade on Thursday, the euro marginally advanced against the US dollar to trade at $1.2172, while it has marginally weakened against the British pound to trade at GBP0.8636.

 COVID NEWS:

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Provincial

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