In the loop 09 July 2026

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is stronger this morning, at R16.36/$, after closing weaker yesterday (R16.39/$*).
EM currencies were mixed yesterday; the KRW (+0.7%), TWD (+0.4%) and ARS (+0.3%) were the biggest gainers; the HUF (-1.5%), ZAR (-0.9%) and INR (-0.6%) were the biggest losers.
Asian equity markets are mixed this morning; the Nikkei and Shanghai Composite are up, while the Hang Seng is down.

Iran war: tensions in the Iran conflict escalated sharply, threatening to derail the fragile diplomatic process established under the June MOU.
The immediate trigger was a series of attacks on commercial vessels in the Strait of Hormuz, which Washington blamed on Iran.
In response, the US launched a new wave of strikes against Iranian military infrastructure.
Iran retaliated with missile and drone attacks targeting US military facilities in Bahrain and Kuwait.

Central bank watch: The minutes of the US FOMC minutes of the June policy meeting showed that policymakers voted unanimously to keep the Fed funds rate unchanged at 3.50%-3.75%.
The minutes noted that discussions reflected growing concern that inflation could remain elevated for longer than previously expected.
Policymakers eventually expect inflation to ease towards the Fed's 2% target; this is expected on the back of a decline in energy prices and as effects of tariffs fade.
Several policymakers argued that an immediate interest rate increase could have been justified at that meeting.
Others indicated that further policy tightening may be required if inflation proves more persistent.
The FOMC expressed concern that rising household inflation expectations and strong investment in AI infrastructure could sustain price pressures by boosting demand for semiconductors, electricity and other inputs.
The minutes also reflected broad support for the new Fed Chair Kevin Warsh's move towards shorter policy statements and the removal of forward guidance.

The ECB's minutes of the 10-11 June monetary policy meeting, due out today, could provide insights on the Governing Council's appetite for a follow-up rate hike.
ECB President Christine Lagarde struck a hawkish note on several fronts in the press conference that followed.

The IMF yesterday downgraded its global growth outlook to 3% in 2026, from its previous estimate of 3.1%.
It cited the lingering effects of the Middle East conflict, elevated energy prices, geopolitical uncertainty and growing trade fragmentation.
The Fund expects global growth to recover to 3.4% next year, assuming energy markets stabilises and shipping through the Strait of Hormuz normalises.
However, it cautioned that risks remain tilted to the downside, on the back of renewed geopolitical tensions, further commodity price volatility, tighter financial conditions and a potential correction in AI-related asset valuations.
The IMF left its US growth forecast for 2026 unchanged at 2.3%; it lowered its Eurozone growth forecast to 0.9% in 2026.
Sub-Saharan Africa was left unchanged at 4.3% in 2026.
South Africa's growth outlook was increased to 1.1% in 2026 and unchanged at 1.3% in 2027.
While the IMF said the global economy has proved more resilient than initially feared, it warned that inflation is now expected to average 4.7% in 2026, before easing to 3.9% in 2027.

China's CPI undershot expectations, coming in at 1.0% y/y in June, from 1,2% y/y in May.
Core CPI also undershot expectations in June, increasing by 1.0% y/y, down from 1.1% y/y in May.
PPI accelerated to 4.1% y/y in June, in line with expectations, and up from 3.9% y/y in May.

According to the UK Royal Institution of Chartered Surveyors (RICS) UK Residential Market Survey, the headline net balance for house prices improved to -33% in June, from -34% in May.
RICS noted that “any nascent improvement remains fragile and is now being tested by renewed political uncertainty on the domestic front”.

US existing home sales for June are scheduled for release today and are expected to have increased by 1.0% m/m, following a 3.2% m/m increase in May.

Locally, manufacturing production for May is on the cards today; production is likely to have declined by 3.1% y/y in May, after having fallen by 2.9% y/y in April.

Brent crude oil is currently at $78.94/bbl; ($78.02/bbl*).
Gold is at $4071/oz ($4077/oz*).
SA CDS 124bps*, Brazil 127bps* and Turkey 227bps*.
Yields: US 10yr at 4.57%*, German bund at 3.09%*, SA 10-year generic at 8.49%*, SA's R2035 at 8.32%*.

* Denotes yesterday's close.

Key events and data:

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