In the loop
Shireen Darmalingam
What you should know this morning:
- The rand is weaker this morning, at R18.56/$, after closing stronger yesterday (R18.48/$*).
- EM currencies were mixed yesterday; the RUB (+1.0%), CLP (+0.8%) and MXN (+0.4%) were the biggest gainers; the IDR (-0.5%), BRL (-0.2%) and PEN (-0.1%) were the biggest losers.
- Asian equity markets: the Nikkei is up; Chinese markets are closed for the New Year holidays.
- Eurozone GDP undershot expectations in Q4:24, coming in at 0.0% q/q, after having increased by 0.4% q/q in Q3:24.
- GDP growth was dragged down by growth contractions in Germany and France.
- However, growth in Spain and Italy improved in Q4:24.
- Eurozone consumer confidence improved to -14.2 (final estimate) in January, from -14.5 in December.
- Economic confidence increased in January, to 95.2, from 93.7 in December.
- The gauge for confidence in the services sector remained unchanged in December, while confidence in the construction sector improved.
- Eurozone inflation expectations for 1 year and 3 years ahead for December are scheduled for release later today.
- One-year-ahead inflation expectations are expected at 2.7% in December, from 2.6% in November.
- Three-year-ahead inflation expectations are likely to have remained unchanged, at 2.4%, in December.
- US GDP growth undershot expectations in Q4:24, increasing by 2.3% q/q (annualised), after having increased by 3.1% q/q (annualised) in Q3:24.
- The increase was driven largely by consumer and business spending.
- Wage increases and employment drove growth in the final quarter.
- US personal income and spending for December are scheduled for release today.
- The core PCE deflator is expected to have increased by 0.2% m/m in December, following a 0.1% m/m increase in November.
- Locally, the National Energy Regulator of South Africa (Nersa) has allowed Eskom to raise electricity tariffs by 12.7% in its next financial year.
- The price increase is effective from 1 April 2025; Eskom had requested a 36% increase.
- Eskom based its request on several factors, including that the regulator had not allowed Eskom to recover the cost of producing electricity for many years.
- Eskom also cited the increase in municipal debt from local governments not paying their accounts as a significant risk.
- Nersa also approved tariff increases of 5.36% for 2027 and 6.19% for 2028.
- The December trade balance is due out today; a trade surplus of R28.9bn is expected, from R34.7bn in November.
- Brent crude is up this morning, and up by 3.6% year-to-date.
- The gold price is up this morning, and up by 6.6% year-to-date.
- Brent crude oil is currently at $77.48/bbl; ($76.87/bbl*).
- Gold is at $2797/oz ($2795/oz*).
- SA CDS 193bps*, Brazil 179bps* and Turkey 257bps*.
- Yields: US 10yr at 4.51%*, German bund at 2.51%*, SA 10-year generic at 10.29%*, SA’s R2035 at 10.31%*.
* Denotes yesterday’s close.
Key events and data:
- 09h00: UK Nationwide house price index (January)
- 11h00: Eurozone 1 yr and 3 yr inflation expectations (December)
- 14h00: SA trade balance (December)
- 15h30: US personal income and spending (December)
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