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In the loop 29 October 2026

In the loop

Shireen Darmalingam

What you should know this morning:

  • The rand is stronger this morning, at R16.61/$, after closing weaker yesterday (R16.66/$*).
  • EM currencies were mixed yesterday; the MYR (+0.3%), PHP (+0.2%) and RUB (+0.1%) were the biggest gainers; the KRW (-1.2%), COP (-0.5%) and CLP (-0.4%) were the biggest losers.
  • Asian equity markets are mixed this morning; the Nikkei and Hang Seng are up, while the Shanghai Composite is down.
 
  • Iran war: diplomatic efforts continue, with Qatar and Pakistan mediating a new seven-day framework, although major differences remain over sanctions relief, the US blockade, the Strait of Hormuz, and Iran's nuclear programme.
 
  • Central bank watch: the US Fed left its benchmark Fed funds rate unchanged at 3.75%-4.00% at its yesterday, following a 25 bps increase in September.
  • Policymakers opted to assess incoming economic data amid persistently elevated inflation. 
  • The Fed upgraded its assessment of economic activity, from expanding at a “solid” pace, to a “strong” pace.
  • It highlighted resilient domestic spending, robust capital investment, and strong productivity growth. 
  • The Committee emphasised that additional economic information would help to determine the appropriate policy stance.
  • Fed Chair Kevin Warsh acknowledged that inflation remained elevated relative to the Fed's 2% target, partly reflecting supply-side shocks, including higher energy prices stemming from the Iran war. 
  • He emphasised that the Fed remained firmly committed to achieving its inflation objective.
  • However, he declined to provide explicit forward guidance on the timing of future interest rate adjustments. 
 
  • The Bank of Canada yesterday hiked its benchmark interest rate by 25 bps, to 2.50%, marking its first interest rate increase since July 2023. 
  • The central bank warned that the prolonged conflict in the Middle East has pushed oil prices higher for longer, increasing production and transportation costs.
  • The bank revised its inflation outlook higher, forecasting inflation to reach around 3.5% by the end of 2026 and average approximately 3% in 2027, then returning to its 2% target by mid-2028. 
 
  • The ECB is likely to keep its benchmark interest rate unchanged at 2.50% today, after raising it by 25 bps in September
  • Attention will likely centre on the policy statement and President Christine Lagarde's press conference for indications of whether another increase may transpire in December, particularly if inflation remains persistent.
  • The ECB is likely to maintain a cautious, data-dependent stance, keeping the option of further tightening open, while assessing incoming inflation and growth data and the impact of September's rate increase.
 
  • The Eurozone consumer sentiment index for October (final estimate) is due out today; sentiment is likely to have remained unchanged at -17.9 in October, from the previous estimate, and from -16.8 in September.
  • Economic confidence is expected to have slipped to 97.5 in October, from 97.9 in September.
 
  • US personal income, due out today, is expected to have increased by 0.3% m/m in September, following a 0.2% m/m increase in August.
  • Personal spending is likely to have increased by 0.6% m/m in September, after having increased by 0.9% m/m in August.
  • The US Fed's preferred inflation gauge for September, the core PCE deflator, is expected to have increased by 0.3% m/m, after having increased by 0.2% m/m in August.
  • The first estimate of Q3:26 GDP is due out today, with real growth likely around 3.2% q/q, up from 2.2% q/q in Q2:26.
  • Such an increase may have been boosted by strong AI-related investment and resilient consumer spending.
 
  • Locally, the M3 and private sector credit extension (PSCE) for September are scheduled for release today.
  • PSCE is expected to have increased by 7.31% y/y in September, following a 7.47% y/y increase in August.
  • The September PPI is also due out and is expected at 5.7% y/y, after having increased by 5.0% y/y in August.
  • On a m/m basis, PPI is likely to have increased by 0.6% in September, following a 0.4% decline in August.
  • Stats SA will publish the long-awaited benchmarking and reweighting of the GDP data that was originally scheduled for publication ahead of the Q2:26 GDP data.
  • Any upward revision should benefit pertinent ratios such as the current account and government debt-to-GDP.
 
  • Brent crude is down this morning, and up by 87.1% year-to-date.
  • The gold price is down this morning, and down by 6.4% year-to-date.
 
  • Brent crude oil is currently at $113.85/bbl; ($115.32/bbl*).
  • Gold is at $4040/oz ($4067/oz*).
  • SA CDS 126bps*, Brazil 135bps* and Turkey 255bps*.
  • Yields: US 10yr at 4.99%*, German bund at 3.37%*, SA 10-year generic at 8.75%*, SA's R2035 at 8.56%*.
 

* Denotes yesterday's close. 

Key events and data: 

  • 08h00: SA M3 and private sector credit extension (September)
  • 11h00: SA rebased GDP
  • 11h30: SA PPI (September)
  • 11h30: UK consumer credit (September)
  • 12h00: Eurozone consumer and economic confidence (October)
  • 14h30: US personal income and spending (September), core PCE deflator (September), initial jobless claims (24 October), GDP (Q3:26)
  • 15h15: Eurozone ECB interest rate decision – no change
 

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