The Rand attempted to reach the R14.85 short-term target yesterday but fell short and ended the day weaker at R15.01. Eskom’s failure to resolve the growing power supply problems and the impact on the South African economy is beginning to take its toll on the currency. The Rand is currently trading weaker at R15.09, in contrast to its EM peers, which are holding on to their recent gains. Tomorrow’s MTBPS will be closely watched for clues as to how the usual government debt, public sector wage bill, and economic growth issues are planned to be addressed.
Gold and Platinum closed slightly firmer yesterday, but Palladium slipped. This morning direction has reversed with Gold and Platinum lower at $1,827 and $1,059, respectively, while Palladium is up around 0.5% at $2,038. The price of oil closed firmer last night as tight supply and strong demand pushed prices higher. Brent is trading a touch firmer at $85.06, while WTI is flat at $84.20.
A reasonably lacklustre day for the Dollar as it ended flat against both the Euro and Pound. This morning, the greenback is trading marginally firmer at 1.1580 against the Euro and 1.3554 against the Pound ahead of today’s CPI data. CPI is expected to have risen to 0.6% MoM and 5.8% YoY. Yesterday’s PPI numbers came out on market estimates and remain relatively elevated. China’s PPI grew by a 26 year high of 13.5% in October. US bond yields firmed across the curve again yesterday, with the 30y-yield closing at 1.82%, the 10y-yield at 1.44%, and the 2y-yield at 0.46%. Equity markets and US futures are all in the red as inflation fears unnerve investors.