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In the loop 13 September 2024

In the loop

Christelle Grobler

What you should know this morning:

  • The rand is trading at R17.73/$ this morning, after closing stronger yesterday (R17.83/$*).
  • EM currencies were mixed yesterday; the COP (+1.5%), CLP (+1.3%) and MXN (+1.1%) gained the most; the PHP (-0.4%), THB (-0.3%) and IDR (-0.2%) lost the most.
  • Asian equity markets are mixed this morning; the Hang Seng and the Shanghai Composite are up, while the Nikkei is down.
 
  • Japan’s industrial production for July came in slightly better than initial estimates.
  • Production rose 3.1% m/m in July (previously 2.8% m/m), after contracting by 4.2% m/m in June.
  • In y/y terms, industrial output was 2.9% higher in July (2.7% previously).
  • Capacity utilisation was up 2.5% m/m in July, after declining 3.1% m/m in June.
 
  • Today sees the release of the University of Michigan’s US consumer sentiment and inflation expectations survey for September.
  • Consumer sentiment is expected to have improved somewhat in September.
  • Inflation expectations likely remained flat at 2.8% for one-year ahead and at 3.0% over the next 5-10 years.
 
  • Chinese President Xi Jinping has urged government officials to “strive to achieve the full-year economic and social development goals”.
  • “All regions and departments should studiously implement all the major economic initiatives and measures introduced by the Central Committee and deliver on the economic tasks for the third and fourth quarters,” Xi said.
  • China has set its growth target around 5% for this year.
  • A slew of data on the Chinese economy for August, including industrial production and retail sales, is due for release tomorrow.
 
  • The International Energy Agency (IEA) published its oil market report yesterday.
  • Global oil demand growth has been slowing rapidly this year; growth is at its lowest rate since the pandemic.
  • This comes as China’s economy is cooling and the use of electric vehicles is rising swiftly internationally.
  • Prices have reached a three-year low despite prolonged supply cuts by the OPEC+ alliance and a major disruption to Libyan output.
  • Non-OPEC+ supply is rising faster than demand, according to the IEA.
  • The IEA’s forecasts a surplus of oil in 2025, even if OPEC+ cancels plans to revive supply.
 
  • Locally, there are no major data releases scheduled for today.
 
  • Brent crude is up this morning, and down by 5.9% year-to-date.
  • The gold price is up this morning, and up by 24.6% year-to-date.
 
  • Brent crude oil is currently at $72.46/bbl; ($71.97/bbl*).
  • Gold is at $2569/oz ($2551/oz*).
  • SA CDS 187bps*, Brazil 153bps* and Turkey 272bps*.
  • Yields: US 10yr at 3.67%*, German bund at 2.15%*, SA 10-year generic at 10.32%*, SA’s R2030 at 8.99%*.
 

* Denotes yesterday’s close.

Key events and data:

  • 10h30: UK BOE/Ipsos inflation expectations (August)
  • 11h00: Eurozone industrial production (July)
  • 14h30: US import and export price indices (August)
  • 16h00: US University of Michigan sentiment and inflation expectations (September)
 

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