In the loop 13 March 2025

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is weaker this morning, at R18.35/$, after closing weaker yesterday (R18.33/$*).
EM currencies were mixed yesterday; the MXN (+0.7%), COP (+0.6%) and HUF (+0.3%) were the biggest gainers; the RUB (-1.9%), ZAR (-0.5%) and CLP (-0.5%) were the biggest losers.
Asian equity markets are mixed this morning; the Nikkei is up, while the Hang Seng and Shanghai composite are down.

Several ECB policymakers commented on the Eurozone economy and monetary policy yesterday.
ECB President Christine Lagarde noted that it is “impossible” for the central bank to always meet its inflation target.
Lagarde commented that the central bank is likely to miss its 2% target more often in the future on the back of “exceptionally high” uncertainty.
She highlighted that higher public borrowing to fund defence and infrastructure as well as the potential threats from tariffs might impact inflation more directly and increase volatility.
The ECB’s goal is to ensure that inflation always converges towards its target in the medium term.

ECB Governing Council member Gediminas Simkus yesterday commented that interest rates in the region are still heading lower.
He nonetheless noted that high levels of uncertainty make it difficult to predict monetary policy decisions.

US President Trump indicated that he would respond to Europe’s countermeasures against his 25% tariffs on steel and aluminium.
The European Commission indicated that it would launch “swift and proportionate countermeasures” on US imports.
It said that it would reimpose balancing measures from 2008 and 2020 and would add a revised list of industrial and agricultural goods.
President Trump did not specify which measures he may take.

The Eurozone’s industrial production is on the cards today and is expected to have expanded by 0.6% m/m in January, following a 1.1% m/m decline in December.

The UK’s Royal Institute of Chartered Surveyors (RICS) house price balance decreased to 11% in February, from 22% in January.
The survey's measures of growth in new buyer enquiries and agreed sales both weakened in February.
Buyer demand slipped to its weakest level since November 2022.

US PPI for February, scheduled for release today, is expected at 3.3% y/y, from 3.5% y/y in January.
On a m/m basis, PPI is expected to have increased by 0.3% in February, after having increased by 0.4% in January.

Locally, mining production for January is due out today; production declined by 2.4% y/y in December.
Mining production declined by 3.9% m/m in December.
Manufacturing production for January is expected to have declined by 1.9% y/y in January, after having fallen by 1.2% y/y in December.
On a m/m basis, manufacturing production is likely to have increased by 0.9% in January, following a 2.4% decrease in December.

Brent crude oil is currently at $70.86/bbl; ($70.95/bbl*).
Gold is at $2943/oz ($2936/oz*).
SA CDS 205bps*, Brazil 175bps* and Turkey 263bps*.
Yields: US 10yr at 4.31%*, German bund at 2.87%*, SA 10-year generic at 10.49%*, SA’s R2035 at 10.48%*.

* Denotes yesterday’s close.

Key events and data:

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