In the loop 30 April 2024

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is weaker this morning, at R18.69/$, after closing stronger yesterday (R18.62/$*).
EM currencies were mixed yesterday; the ZAR (+1.0%), COP (+0.9%) and CLP (+0.9%) were the biggest gainers; the RUB (-1.7%), IDR (-0.3%) and ARS (-0.2%) were the biggest losers.
Asian equity markets are mixed this morningl the Nikkei and Hang Seng are up, while the Shanghai Composite is down.

The Chinese official manufacturing PMI came in slightly higher than expected at 50.4 in April, from 50.8 in March.
The non-manufacturing PMI slipped to 51.2 in April, from 53.0 in March; the composite PMI also slipped in April.
The Caixin manufacturing PMI beat expectations, coming in at 51.4 in April, from 51.1 in March.
Today’s data signalled that the recovery may be gathering momentum.

Japan’s industrial output for March bounced back from the dip in February; industrial production increased by 3.8% m/m in March, after having declined by 0.6% m/m in February.
The improvement comes after weakness early in Q1:24, as a New Year’s Day earthquake northwest of Tokyo and output suspensions in the auto industry weighed on activity from January.
On a y/y basis, production was down by 6.7% in March, following a 3.9% decline in February.
Japan’s unemployment rate for March came in unchanged at 2.6%.

The Eurozone CPI for April is due for release today and is expected to have come in at 2.4% y/y, matching March’s increase.
Core inflation is likely to have moderated to 2.6% y/y in April, from 2.9% y/y in March.
CPI is likely to drop below 2% in the summer; markets are expecting the ECB to start its rate cutting cycle as early as the June policy meeting.
Eurozone GDP for Q1:24 will also be in focus today; the data is expected to confirm that the Eurozone exited the recession of last year.
The Eurozone economy likely expanded 0.1% q/q in Q1:24, after contracting 0.1% q/q in both Q4:24 and Q3:23.
Several Eurozone countries’ GDP data for Q1:24 will also be released today.

The US Conference Board consumer confidence index for April is due out today.
The index is likely to have slipped to 104.0 in April, from 104.7 in March.
The assessment of the labour market conditions will be important ahead of the non-farm payrolls data for April on Friday.
House prices for February, according to the FHFA house price index, are expected to have increased by 0.2% m/m, following a 0.1% m/m decline in January.

Locally, the M3 and private sector credit extension (PSCE) for March are due out today.
PSCE is likely to come in at 3.43% y/y in March, from 3.32% y/y in February; M3 money supply is likely to come in at 5.7% y/y in March, matching February’s increase.
The March trade surplus is due out today; a trade surplus of R16.5bn is expected, from R14.0bn in February.
The monthly Budget balance data for March is expected to have compressed to a surplus of R11.8bn in March, from a surplus of R20.8bn in February.

Brent crude oil is currently at $88.24/bbl; ($88.40/bbl*).
Gold is at $2322/oz ($2342/oz*).
SA CDS 236bps*, Brazil 148bps* and Turkey 296bps*.
Yields: US 10yr at 4.61%*, German bund at 2.53%*, SA 10-year generic at 11.97%*, SA’s R2030 at 10.65%*.

* Denotes yesterday’s close.

Key events and data:

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