In the loop 24 April 2025

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is stronger this morning, at R18.64/$, after closing weaker yesterday (R18.66/$*).
EM currencies were mixed yesterday; the CNY (+0.3%), BRL (+0.3%) and PEN (+0.2%) were the biggest gainers; the ARS (-5.2%), RUB (-2.0%) and HUF (-0.9%) were the biggest losers.
Asian equity markets are mixed this morning; the Nikkei is up, while the Hang Seng and Shanghai Composite are down.

ECB Governing Council member Madis Muller noted yesterday that the central bank may need to lower interest rates further to levels that stimulate the economy if trade uncertainty proves more damaging for growth in the region.
Muller noted that interest rates are currently at levels that no longer restrict demand.
Policymakers have indicated that they need more clarity on tariff negotiations between the US and Europe.
Muller added that it is thus too soon to say whether the ECB will reduce rates again in June, or pause.
He remarked that “the uncertainty coming from the US around trade policy makes the outlook quite a bit more challenging”.
BOE Governor Andrew Bailey yesterday commented that the risk to UK economic growth, as well as global growth, from trade disruptions must be taken seriously.

The Fed’s latest Beige Book highlighted that the outlook in several regions worsened considerably as economic uncertainty, particularly around tariffs, rose.
Employment was little changed to up slightly in most districts.
Hiring was generally slower for consumer-facing firms than for business-to-business firms.
Several districts reported that firms were taking a wait-and-see stance, while there were also reports of firms preparing for layoffs.
Most businesses also expect to pass on the price hikes to consumers.
President Trump indicated that new lower tariffs for China could be decided in the next two to three weeks.

US durable goods orders for March are scheduled for release today; durable goods orders are expected to have improved.
A surge in aircraft orders is expected to have boosted the headline data.
US existing home sales will likely have declined by 3.1% m/m (to 4.13m) in March, after having increased by 4.2% (4.26m) m/m in February.

Locally, the March PPI is on the cards today and is likely to come in at 0.7% y/y, from 1.0% y/y in February.
On a m/m basis, PPI is likely to have increased by 0.6% in March, after having increased by 0.4% in February.

Brent crude oil is currently at $66.20/bbl; ($66.12/bbl*).
Gold is at $3325/oz ($3295/oz*).
SA CDS 243bps*, Brazil 190bps* and Turkey 326bps*.
Yields: US 10yr at 4.38%*, German bund at 2.49%*, SA 10-year generic at 10.83%*, SA’s R2035 at 10.80%*.

* Denotes yesterday’s close.

Key events and data:

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