In the loop 08 July 2025

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is weaker this morning, at R17.80/$, after closing weaker yesterday (R17.79/$*).
EM currencies were largely down yesterday; the ARS (-1.7%), COP (-1.5%) and CLP (-1.3%) were the biggest losers; the RUB was up by 0.2%.
Asian equity markets the Nikkei, Hang Seng and Shanghai Composite are up.

Central bank watch: the Reserve Bank of Australia (RBA) has held its benchmark interest rate steady, at 3.85%, against expectations for a 25 bps cut.
The central bank cited a wait-and-see approach due to uncertainty caused by US tariff plans.
The RBA noted the central bank as well placed to respond decisively to international developments.

The 90-day delay in President Trump’s reciprocal tariffs is set to expire tomorrow; a new deadline of 1 August is now in place.
President Trump noted yesterday that any country aligning with BRICS nations’ “anti-American” policies would face an additional 10% tariff.
The BRICS nations have expressed deep concerns over the unilateral tariff and non-tariffs measures.
They noted that it “distorts trade and are inconsistent with WTO rules”.

Japan and South Korea were the recipients of the first tariff letters sent out by President Trump.
President Trump yesterday announced that he would be imposing 25% tariffs on goods from Japan and South Korea, effective 1 August.
This gives Japan and South Korea a three-week window to open their markets to US products and manufacture more in the US.
Further, he warned these two nations against retaliation; he noted that, if they should raise their tariffs, the US would add any such increase to the 25% rate.
Several other countries have since received tariff letters.

The EU noted that it plans to reach a trade deal with the US this week.
President Trump has also announced that he would subject imports from South Africa to 30% tariffs that would take effect from 1 August.
Trump added that if South Africa were to increase its tariffs in response to his announcement, the amount by which SA may choose to raise its tariffs would be added to the existing 30%.
He added that these tariffs may be modified either upward or downward; and, this would depend on SA’s relationship with the US.
President Cyril Ramaphosa noted that the “reciprocal tariff is not an accurate picture of the available data when it comes to trade relations”.

The US NFIB small business optimism index for June, due out today, is expected to have slipped, albeit marginally, to 98.6, from 98.8 in May.

Brent crude oil is currently at $69.28/bbl; ($69.58/bbl*).
Gold is at $3336/oz ($3327/oz*).
SA CDS 188bps*, Brazil 144bps* and Turkey 288bps*.
Yields: US 10yr at 4.37%*, German bund at 2.64%*, SA 10-year generic at 9.89%*, SA’s R2035 at 9.81%*.

* Denotes yesterday’s close.

Key events and data:

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