In the loop 29 July 2024

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is unchanged this morning, at R18.27/$, after closing stronger on Friday (R18.27/$*).
EM currencies were mixed on Friday; the PEN (+0.5%), TRY (+0.4%) and ZAR (+0.3%) were the biggest gainers; the RUB (-1.2%), MXN (-0.5%) and IDR (-0.3%) were the biggest losers.
Asian equity markets the Nikkei, Hang Seng and Shanghai Composite are up.

China's PMI surveys, due out on Wednesday, are likely to show the economic recovery continuing to slow in July.
Indicators are pointing to a further slowdown in manufacturing, while the gauge of services and construction will probably signal almost no growth.
The BOJ will meet on Wednesday and is expected to hike its benchmark interest rate again.
The BOJ is also largely expected to start cutting bond-buying.

The BOE will meet this week (Thursday) and is expected to cut its benchmark interest rate by 25bps, to 5.0%.
UK housing market is likely to show signs of resilience; house prices are expected to have increased by 1.9% y/y in July, after having increased by 1.5% y/y in June.
The Eurozone GDP for Q2:24 is due out tomorrow; GDP is expected to come in at 0.3% q/q in Q2:24, matching the increase in Q1:24.
Eurozone CPI data for July will likely show headline inflation staying unchanged and the core measure falling only slightly in July; the data is due out on Wednesday.

The US Fed’s FOMC meeting is in the spotlight on Wednesday.
While the Fed is expected to keep the Fed funds rate unchanged, the Fed is expected to signal a rate cut soon.
Investors will keep an eye Fed Chair Jerome Powell’s comments after the meeting; Powell could signal the readiness to cut as soon as September.
The US consumer confidence index for July, due out tomorrow, likely slipped to 99.5, from 100.4 in June.
The Job Openings and Labour Turnover Survey (JOLTS) job openings for June, also scheduled for release tomorrow, are likely to have fallen further.
The June JOLTS print should slow down modestly to 8.055 million, from 8.140 million in May.
Non-farm payrolls (NFP) for July, due out on Friday, are also expected to have slowed, to 178k, following an increase of 206k in June.
The unemployment rate is likely to have remained unchanged, at 4.1%, in July.
The US ISM manufacturing index for July is due out on Thursday. Improved new orders in June likely helped to support production activity.

Locally, the M3 and private sector credit extension (PSCE) for June are due this morning.
PSCE is likely to come in at 4.0% y/y in June, from 4.25% y/y in May.
The monthly Budget balance data for June is scheduled for release tomorrow; the budget balance is likely to have increased to a surplus of R43.7bn in June, from a deficit of R12.8bn in May.
The June trade balance is due on Wednesday; a trade surplus of R18.5bn is expected, from R20.1bn in May.
The BER manufacturing PMI for July is due for release on Thursday; the index is expected to have increased to 48.0 in July, from 45.7 in June.
The July Naamsa vehicle sales also due out on Thursday; vehicle sales likely declined by 9.4% y/y in July, after having fallen by 14.0% y/y in June.
Electricity production and consumption for June are scheduled for release on Thursday.

Brent crude oil is currently at $81.56/bbl; ($81.13/bbl*).
Gold is at $2393/oz ($2387/oz*).
SA CDS 199bps*, Brazil 157bps* and Turkey 259bps*.
Yields: US 10yr at 4.19%*, German bund at 2.40%*, SA 10-year generic at 10.78%*, SA’s R2030 at 9.44%*.

* Denotes Friday’s close.

Key events and data:

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