In the loop 06 October 2026

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is stronger this morning, at R16.64/$, after closing weaker yesterday (R16.67/$*).
EM currencies were mixed yesterday; the BRL (+4.4%), COP (+2.1%) and CLP (+1.8%) were the biggest gainers; the RUB (-0.8%), CZK (-0.6%) and RON (-0.6%) were the biggest losers.
Asian equity markets the Nikkei, Hang Seng and Shanghai Composite are up.

Iran war: Iranian President Masoud Pezeshkian has reiterated that negotiations with the US are currently “meaningless”.
He argued that previous diplomatic engagements had been followed by military action.
President Trump has maintained that the war was “essentially almost over” but insisted that Iran would not be allowed to develop a nuclear weapon.

ECB Governing Council member Joachim Nagel yesterday commented that the ECB must remain flexible in setting monetary policy.
He stated that the future path of inflation remains highly uncertain and heavily dependent on geopolitical developments, particularly the impact of the Iran conflict on energy markets.
Nagel argued that policymakers need to be prepared for a range of inflation outcomes, noting that a sustained reopening of the Strait of Hormuz and a normalisation of energy supplies could ease price pressures.
He added that further disruptions could drive oil and gas prices even higher.
He reiterated that the ECB should continue to make decisions on a data-dependent, meeting-by-meeting basis rather than committing to a predetermined policy path.

The Eurozone retail sales for August are scheduled for release today and are expected to have increased by 1.0% y/y, following a 0.6% y/y increase in July.
On a m/m basis, sales are likely to have increased by 0.2% in August, after having fallen by 0.6% in July.

The US ISM services PMI slipped more than expected in September, to 54.9, from 55.4 in August.
Despite the slippage, the data signals solid growth across the sector; business activity continued to expand, supported by resilient demand.
This is despite ongoing geopolitical tensions and higher energy costs.
However, inflationary pressures remained a concern, with firms reporting elevated input costs linked to fuel and transportation expenses.

The US trade balance for August is due out today; the deficit is likely to have widened in August, to -$102bn, from -$88.6bn in July.
Exports likely increased less than imports in August.

Locally, it's a quiet day as far as data releases are concerned.
South Africans will face record high fuel prices after the Department of Mineral and Petroleum Resources announced steep price increases yesterday.
This comes as the latest oil price shock from the Iran war feeds through to the government's monthly adjustment.
The retail price of 95-octane petrol in Gauteng will rise by R3.33/l at midnight, a 12% increase that will take the pump price to a record R30.25/l.
Diesel prices will also rise sharply, increasing by as much as R3.24/l.

Oil prices were relatively steady yesterday as rising crude exports from the Middle East and plans by the G7 nations to release emergency oil reserves helped ease immediate concerns over supply disruptions.
However, geopolitical tensions remained elevated, keeping uncertainty around the oil market outlook high.
The G7 agreed on Friday to release 100 million barrels of crude oil and fuel products from emergency reserves, including a substantial amount of diesel within 20 days.
This is aimed at easing pressure on energy markets and mitigating supply disruptions stemming from the Iran war.

Brent crude oil is currently at $100.88/bbl; ($100.32/bbl*).
Gold is at $4123/oz ($4139/oz*).
SA CDS 143bps*, Brazil 112bps* and Turkey 255bps*.
Yields: US 10yr at 5.30%*, German bund at 3.49%*, SA 10-year generic at 9.09%*, SA's R2035 at 8.86%*.

* Denotes yesterday's close.

Key events and data:

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