In the loop
What you should know this morning:
- The rand is stronger this morning, at R17.18/$, after closing weaker yesterday (R17.20/$*).
- EM currencies were mixed yesterday; the COP (+0.9%), MXN (+0.3%) and CZK (+0.3%) were the biggest gainers; the PEN (-0.7%), HUF (-0.7%) and ARS (-0.5%) were the biggest losers.
- Asian equity markets the Nikkei, Hang Seng and Shanghai Composite are up.
- Eurozone consumer confidence improved in January but remained in negative territory.
- The confidence index increased to -20.9 in January, from -22.2 in December.
- The improvement to the highest level since February 2022 signals some resilience as the region tries to avoid a recession this year.
- Nonetheless, consumer sentiment remains low by historical standards and below the long-term average.
- Consumers are still particularly concerned about inflation continuing to erode purchasing power.
- However, recent gains add to evidence that this regional economy is performing better than expected despite the energy-price shock.
- The US leading index slid by 1% in December, after a 1.1% slippage in November.
- The biggest positive contributor to the leading index was orders for non-defence capital goods.
- The coincident index, which measures current conditions, rose 0.1% in December, following no change in November.
- Pakistan’s central bank raised its key rate by 100 bps, to 17%, the highest in over 24 years.
- The increase comes as this economy grapples with rising inflation, supply shortages, and stalled foreign financing.
- The government has an economic growth estimate of 2% for this year; the risks here, however, are to the downside.
- Japan’s Jibun Bank composite PMI increased to 50.8 in January, from 49.7 in December.
- Both the manufacturing and services PMI improved in January.
- PMI data for several countries, due out today, is likely to exhibit a mixed picture.
- The Eurozone composite PMI for January is expected to have edged up, to 49.8, from 49.3 in December.
- Falling energy costs have boosted prospects for consumers and factories.
- The UK manufacturing gauge is seen rising to 48.5 in January, while the composite PMI is expected to slip to 48.8.
- The US manufacturing PMI is expected to have increased in January, while the services component likely slipped further in January.
- Locally, the SARB’s leading indicator for December is scheduled for release today; the index slipped to 123 in November, from 124.1 in December.
- Eskom: loadshedding has been downgraded to Stage 3; Stage 4 loadshedding will commence at 4pm until 5am tomorrow.
- Brent crude oil is down this morning, and up by 2.5% year-to-date.
- The gold price is up this morning, and up by 6.1% year-to-date.
- Brent crude oil is currently at $88.05/bbl; ($88.19/bbl*).
- Gold is at $1934/oz ($1923/oz*).
- SA CDS 254bps*, Brazil 244bps* and Turkey 551bps*.
- Yields: US 10yr at 3.50%*, German bund at 2.20%* and SA 10-year generic at 10.51%*, SA’s R186 at 8.25%*.
* Denotes yesterday’s close.
Key events and data:
- 09h00: SA leading indicator (December)
- 11h00: Eurozone S&P Global manufacturing, services and composite PMI (January)
- 11h30: UK S&P Global manufacturing, services and composite PMI (January)
- 16h45: US S&P Global manufacturing, services and composite PMI (January)