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In the loop 28 January 2025

In the loop

Shireen Darmalingam

What you should know this morning:

  • The rand is weaker this morning, at R18.81/$, after closing weaker yesterday (R18.76/$*).
  • EM currencies were mixed yesterday; the RUB (+0.6%) and BRL (+0.2%) were the biggest gainers; the MXN (-2.1%), ZAR (-1.9%) and PEN (-0.6%) were the biggest losers.
  • Asian equity markets are mixed this morning; the Nikkei is up, while the Hang Seng and Shanghai Composite are down.
 
  • Central bank watch: the central bank of Chile is expected keep its main interest rate unchanged, at 5.0%.
 
  • The ECB’s quarterly Bank Lending Survey is scheduled for release today; the survey results will likely show demand for, and supply of credit, as improving.
  • ECB Governing Council member Robert Holzmann commented that increasing taxes on Austrian banks would be a “valid choice” for a government trying to reduce the country’s budget deficit.
  • He added that, while a tax would be a “political decision,” it could help the government close fiscal gaps.
 
  • US President Donald Trump yesterday said that he would want universal tariffs at “much bigger” than 2.5%.
  • It’s been reported that this may gradually rise to as high as 20%.
  • President Trump indicated that he would impose tariffs on foreign computer chips, pharmaceuticals and metals “in the very near future”.
 
  • US new home sales increased more than expected in December, by 3.6% m/m (to 698k annualised), after increasing by an upwardly revised 9.6% m/m in November (to 674k annualised).
  • New home sales increased as customers took advantage of incentives from builders. 
  • Data from the National Association of Homebuilders showed that more than 60% of builders reported using sales incentives.
  • 30% have indicated that they were cutting prices.
  • This led to a second straight year of increased purchases.
 
  • US durable goods orders for December, due today, are expected to have increased by 0.6% m/m, following a 1.2% m/m decline in November.
  • Durable goods excluding transportation likely improved in December.
  • The S&P CoreLogic house price index is expected to have increased by 4.2% y/y in November, following a 4.2% y/y increase in October.
  • The FHFA house price index is expected to have increased by 0.3% m/m in November, after having increased by 0.4% m/m in October.
  • The US Conference Board consumer confidence index for January, due out today, likely improved to 105.9, from 104.7 in December.
 
  • Locally, the SARB’s leading indicator for November is scheduled for release today; the index increased to 114.0 in October. 
 
  • Brent crude is up this morning, and up by 3.8% year-to-date.
  • The gold price is up this morning, and up by 4.5% year-to-date.
 
  • Brent crude oil is currently at $77.45/bbl; ($77.08/bbl*).
  • Gold is at $2742/oz ($2733/oz*).
  • SA CDS 199bps*, Brazil 181bps* and Turkey 264bps*.
  • Yields: US 10yr at 4.53%*, German bund at 2.53%*, SA 10-year generic at 10.44%*, SA’s R2035 at 10.46%*.
 

* Denotes yesterday’s close. 

Key events and data:

  • 08h00: Japan machine tool orders (December – final)
  • 09h00: SA leading indicator (November)
  • 11h00: Eurozone ECB Bank Lending Survey
  • 15h30: US durable goods orders (December)
  • 16h00: US FHFA house price index (November), S&P CoreLogic house price index (November)
  • 17h00: US Conference Board consumer confidence index (January)
 

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