In the loop 15 October 2025

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is stronger this morning, at R17.31/$, after closing weaker yesterday (R17.36/$*).
EM currencies were mixed yesterday; the RUB (+2.3%), HUF (+0.4%) and BGN (+0.3%) were the biggest gainers; the ARS (-0.5%), ZAR (-0.4%) and BRL (-0.3%) were the biggest losers.
Asian equity markets the Nikkei, Hang Seng and Shanghai Composite are up.

ECB Governing Council member Francois Villeroy de Galhau said that the central bank’s next move is more likely to be a rate cut than a hike.
He noted the risks to the inflation outlook as tilted to the downside, making a rate reduction more plausible if policy needs to be adjusted further.
Villeroy added that the current monetary policy stance could change as economic conditions evolve.
ECB President Christine Lagarde similarly remarked that she would “never say” rate cuts are over, even as she described the risks to economic growth and inflation as “fairly balanced.”

Eurozone industrial data for August will be released today; output is expected to have declined m/m.

US Fed Chair Jerome Powell yesterday signalled that the Fed is on track to deliver another 25 bps rate cut later this month as weak hiring pressures unemployment.
Powell cautioned yesterday that the risks to employment have increased in recent months; he noted that job creation in the US economy has slowed sharply.
He commented that “while the unemployment rate remained low through August, payroll gains have decelerated significantly”.
Powell added that overall economic growth still appears to be holding up well.
Official employment data for September have not yet been released because of the ongoing US government shutdown.
However, private sector labour data implies a notable slowdown in hiring last month.
Boston Fed President Susan Collins said the Fed should continue lowering interest rates this year to support the labour market.
The Fed is scheduled to meet on 28-29 October; Fed policymakers are looking to alternative data sources due to the government shutdown.

Despite the US government shutdown that began on 1 October, the Fed’s Beige Book is due for release today.
The Beige Book is expected to show sluggish employment growth and signs of consumer resistance to higher prices.
The Mortgage Bankers Association (MBA) is a private organisation, and its weekly mortgage applications will not be affected by the US government shutdown.
Mortgage applications decreased by 4.7% for the week ending 3 October, after having decreased by 12.7% in the previous week.
The Empire manufacturing index for October, also due out today, is expected to have improved to -1.8, from -8.7 in September.

Locally, the August retail sales data is scheduled for release today.
Sales are expected to have increased by 3.7% y/y in August, after having increased by 5.6% y/y in July.

Brent crude oil is currently at $62.28/bbl; ($62.39/bbl*).
Gold is at $4192/oz ($4142/oz*).
SA CDS 175bps*, Brazil 155bps* and Turkey 270bps*.
Yields: US 10yr at 4.03%*, German bund at 2.61%*, SA 10-year generic at 9.25%*, SA’s R2035 at 9.12%*.

* Denotes yesterday’s close.

Key events and data:

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