In the loop

What you should know this morning:

• The rand is weaker this morning, at R18.29/$, after closing weaker yesterday (R18.23/$*).
• EM currencies were mixed yesterday; the CLP (+0.7%), THB (+0.4%) and HUF (+0.4%) were the biggest gainers; the BRL (-0.7%), COP (-0.6%) and ZAR (-0.4%) were the biggest losers.
• Asian equity markets the Nikkei, Hang Seng and Shanghai Composite are down.

• The ECB’s policy meeting minutes of the October meeting are due out today; the minutes will be closely watched for further indications on whether rates will be lowered in December.
• Recall, the ECB in October cut its benchmark interest rate, by 25 bps, to 3.25% (the lowest since May 2023).
• The central bank noted then that “the incoming information on inflation shows that the disinflationary process is well on track”.
• Eurozone industrial production for September will be released today; production is likely to have been constrained by the weakness in Germany.
• Industrial production is likely to have fallen by 1.4% y/y in September, after having increased by 1.8% y/y in August.

• The UK’s Royal Institute of Chartered Surveyors (RICS) house price balance increased in October to 16% (the highest since 2021), from 11% in September.
• The survey showed that sales expectations and new buyer enquiries remained in positive territory in October.
• The increase comes on the back of cheaper mortgages and rising incomes.
• Today’s data is the latest sign that the UK housing market recovery continued into autumn.

• St. Louis Fed President Alberto Musalem has noted US monetary policy as currently restrictive.
• However, he noted that financial conditions overall are supportive of economic activity.
• He expects inflation to converge to the Fed’s 2% target over the next 12-24 months.
• Kansas City Fed President Jeff Schmidt noted that he is uncertain about how far interest rates should fall.
• He said that “it remains to be seen how much further interest rates will decline or where they might eventually settle”.
• Several other Fed expressed similar uncertainty about how far the Fed can reduce rates.

• Locally, we look to the mining production data for September today.
• Mining production is expected to have increased by 2.1% y/y in September, after having increased by 0.3% y/y in August.
• On a m/m basis, production is likely to have declined by 0.4% in September, following a 2.9% increase in August.

• Brent crude is down this morning, and down by 6.7% year-to-date.
• The gold price is down this morning, and up by 24.1% year-to-date.

• Brent crude oil is currently at $71.91/bbl; ($72.28/bbl*).
• Gold is at $2559/oz ($2583/oz*).
• SA CDS 184bps*, Brazil 160bps* and Turkey 256bps*.
• Yields: US 10yr at 4.45%*, German bund at 2.39%*, SA 10-year generic at 10.38%*, SA’s R2035 at 10.43%*.

* Denotes yesterday’s close. 

Key events and data:

• 11h30: SA mining production (September)
• 12h00: Eurozone GDP (Q3:24), employment (Q3:24), industrial production (September)
• 14h30: Eurozone ECB policy meeting minutes (16-17 October meeting)
• 15h30: US PPI (October)
• 15h30: US initial jobless claims (9 November)

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