In the loop

What you should know this morning:

• The rand is stronger this morning, at R16.85/$, after closing stronger yesterday (R16.86/$*).
• EM currencies were mixed yesterday; the BRL (+1.2%), CZK (+1.1%) and HUF (+1.1%) were the biggest gainers; the RUB (-1.4%), INR (-0.4%) and TWD (-0.2%) were the biggest losers.
• Asian equity markets the Nikkei, Hang Seng and Shanghai Composite are up.

• China yesterday outlined its fiscal and monetary plans for 2026 at the Central Economic Work Conference in Beijing.
• China’s leadership signalled a proactive fiscal stance and moderately loose monetary policy to support growth in 2026 amid global trade tensions and domestic structural challenges.
• The conference emphasised maintaining a “necessary” budget deficit and debt scale, with spending directed toward public services (healthcare, childcare, education, eldercare) to boost productivity and household consumption.
• Fiscal measures will include counter-cyclical and cross-cyclical adjustments, optimising expenditure structure, and strengthening oversight of local government borrowing to mitigate debt risks.
• Policymakers pledged the flexible use of tools, including cuts to banks’ reserve requirement ratios (RRR) and modest interest rate reductions, to maintain liquidity and stabilise credit conditions.
• Risk prevention was also stressed at the conference.

• The UK monthly GDP for October, due today, likely recorded a small gain after September’s contraction. 
• GDP is expected to have expanded by 0.1% m/m in October, after having contracted by 0.1% m/m in September.
• Consumer restraint remains a drag on activity.
• Manufacturing and industrial production data for October are also on the cards as well as October’s visible trade balance figures.

• The Fed yesterday reappointed 11 regional presidents earlier than expected, easing concerns that President Trump’s allies on the Fed’s board might attempt to block their continuation in office. 
• The vote, normally held every five years, had been scheduled for completion by the end of February and has rarely drawn much attention in the past. 
• However, President Trump’s hostility towards the Fed had raised fears that some leaders of the Fed’s regional network could face opposition to their reappointments. 
• Several Fed policymakers are scheduled to speak later today on the economy and monetary policy.

• Locally, the BER’s Q4:25 inflation expectations will be released today.
• Average inflation expectations declined in Q3:25 among business people and trade unions, while those of analysts remained unchanged for 2025.
• Downward revisions in Q3:25 came in the wake of the SARB’s announcement at the end of July to aim inflation at 3%, which was just ahead of the survey period.

• Brent crude is up this morning, and down by 17.3% year-to-date.
• The gold price is down this morning, and up by 62.7% year-to-date.

• Brent crude oil is currently at $61.72/bbl; ($61.28/bbl*).
• Gold is at $4271/oz ($4280/oz*).
• SA CDS 138bps*, Brazil 138bps* and Turkey 221bps*.
• Yields: US 10yr at 4.15%*, German bund at 2.84%*, SA 10-year generic at 8.54%*, SA’s R2035 at 8.41%*.

* Denotes yesterday’s close.

Key events and data: 

• 09h00: UK monthly GDP (October), industrial production (October), manufacturing production (October), visible trade balance (October)
• SA BER inflation expectations (Q4:25)

** Please note that this is the last publication of In the loop for 2025. Publication will resume on 12 January 2026.

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