In the loop
Shireen Darmalingam
What you should know this morning:
- The rand is stronger this morning, at R19.10/$, after closing stronger yesterday (R19.18/$*).
- EM currencies were mixed yesterday; the COP (+0.9%), HUF (+0.4%) and PHP (+0.3%) were the biggest gainers; the PLN (-1.3%), CZK (-1.3%) and CLP (-0.6%) were the biggest losers.
- Asian equity markets the Nikkei, Hang Seng and Shanghai Composite are down.
- Several Fed policymakers commented on the US economy and monetary policy yesterday.
- Chicago Fed President Austan Goolsbee noted that the debate is now shifting to how long policymakers should be keeping rates elevated.
- Dallas Fed President Lorie Logan noted that pausing the hiking cycle at the upcoming meeting might be appropriate.
- Logan, however, also signalled that rates might have to rise further to get inflation back to 2%.
- New York Fed President John Williams said that, while US monetary policy is "in a good place”, policymakers would need to assess the data to decide on how to proceed on rates.
- He noted that policy is having the desired effects of bringing demand and supply more into balance as well as bringing inflation down.
- Germany’s CPI for August is scheduled for release today.
- Russia’s CPI is also on the cards today; CPI is expected at 5.1% y/y in August, from 4.3% y/y in July.
- Inflation is also expected to come in north of the Bank of Russia’s target for the remainder of the year.
- The policy rate is expected to stay at 12% – at least until December.
- Japan’s economy expanded at a slower pace than initially estimated in Q2:23.
- GDP growth was 4.8% q/q in Q2:23, from 6.0% q/q in Q1:23; This as businesses and consumers spent less.
- The expansion was driven almost entirely by overseas demand.
- The data supports Prime Minister Fumia Kishida’s view that households and companies need more help as they struggle amidst the highest inflation in decades.
- The G20 Summit 2023 kicks off in India from 9-10 September.
- The Summit, under the theme of “Vasudhaiva Kutumbakam," translating into "One Earth · One Family · One Future”, will focus on policy matters to achieve global economic and sustainable growth.
- There is speculation that Indian Prime Minister Narendra Modi may formally change India’s name to “Bharat”.
- Eskom: Stage 5 loadshedding is currently in place until 4pm; Stage 6 loadshedding will be implemented then.
- The stage of loadshedding was downgraded from 6 to 5 on the back of improved generation capacity and emergency reserves.
- Brent crude oil is down this morning, and up by 4.0% year-to-date.
- The gold price is up this morning, and up by 5.5% year-to-date.
- Brent crude oil is currently at $89.31/bbl; ($89.92/bbl*).
- Gold is at $1925/oz ($1918/oz*).
- SA CDS 254bps*, Brazil 174bps* and Turkey 385bps*.
- Yields: US 10yr at 4.24%*, German bund at 2.61%* and SA 10-year generic at 11.58%*, SA’s R2030 at 10.37%*.
* Denotes yesterday’s close.
Key events and data:
- 21h00: US consumer credit (July)
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