In the loop 17 June 2025

In the loop

Christelle Grobler

What you should know this morning:

The rand is trading at R17.82/$ this morning, after closing stronger yesterday (R17.79/$*).
EM currencies were mostly stronger yesterday; the RUB (+1.8%), BRL (+0.9%), ZAR (+0.9%) and COP (+0.7%) were the biggest gainers; the PHP (-0.5%) and THB (-0.1%) were weaker.
Asian equity markets are mixed this morning; the Nikkei is up, while the Hang Seng and Shanghai Composite are down.

Central bank watch: the Bank of Japan (BOJ) today kept its overnight call rate at 0.50%, as was widely expected.
The BOJ also announced plans to taper its bond purchases at a slower pace next year.
Monthly bond purchases will be trimmed at a quarterly pace of ¥200bn from the next fiscal year, from the current ¥400bn.
This signals a cautious approach due to heightened market volatility.
Governor Kazuo Ueda is expected to highlight the upside risks to inflation at the BOJ press conference later today.

China released a slew of economic data yesterday.
Retail sales expanded 6.4% y/y in May, the fastest growth since December 2023, accelerating from 5.1% y/y in April.
The stronger-than-expected growth in retail trade sales in May was likely due to an earlier-than-usual online shopping festival and government subsidies for home appliances.
Sales of household electronics soared by 53% y/y in May, the fastest pace on record; sales of mobile phones and other communication equipment jumped 33% y/y in May.
Industrial output grew 5.8% y/y in May, slower than the 6.1% y/y gain in April.
Fixed-asset investment expanded 3.7% y/y in the first five months, moderating from 4.0% y/y up to April.
The jobless rate improved slightly, to 5.0% in May, from 5.1% in April.

The US Empire manufacturing indicator came under pressure in June; the general business conditions index declined to -16, from -9.2 in May.
This marks the fourth straight month of contraction in this gauge of New York state factory activity.
Orders and shipments shrank in June – but expectations improved.
Current new orders declined sharply, to -14.2, while the index of shipments slid to -7.2 in June; both are at their weakest level in three months.
The outlook for business conditions in the next six months jumped more than 23 points, with expectations for orders and shipments rebounding.
The index of current prices paid for materials decreased by more than 12 points in June – the most in almost two years.
Current prices received rose to the second-highest level since early 2023; the outlook for prices charged also increased in June.
US retail trade sales, trade price indices and industrial production data for May are due today.

Locally, there are no major data releases scheduled for today.
Tomorrow will see the release of CPI inflation data for May.
Following its June Plenary on Friday, the Financial Action Task Force (FATF) made the initial determination that SA has completed its 22-point action plan.
The FATF granted SA an on-site assessment of Anti-Money Laundering and Counter-Terrorism Financing reforms implemented.
Due to take place in the next few months, the on-site assessment aims to “verify that the implementation of AML/CFT reforms has begun and is being sustained, and that the necessary political commitment remains in place to sustain implementation in the future”.
This paves the way for SA to be removed from the so-called FATF grey list at the FATF October Plenary.

Brent crude oil is currently at $73.86/bbl; ($73.23/bbl*).
Gold is at $3392/oz ($3385/oz*).
SA CDS 188bps*, Brazil 150bps* and Turkey 299bps*.
Yields: US 10yr at 4.45%*, German bund at 2.53%*, SA 10-year generic at 10.19%**, SA’s R2035 at 10.14%**.

* Denotes yesterday’s close; ** denotes Friday’s close.

Key events and data:

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