In the loop 03 March 2025

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is stronger this morning, at R18.62/$, after closing weaker on Friday (R18.69/$*).
EM currencies were largely down on Friday; the RUB (-2.0%), ZAR (-1.4%) and CLP (-1.1%) were the biggest losers; the CNY was up by 0.1%.
Asian equity markets the Nikkei, Hang Seng and Shanghai Composite are up.

Central bank watch: the ECB will meet on Thursday and is expected to cut its benchmark interest rate by 25 bps.
The Central Bank of the Republic of Turkey is expected to cut rates by 250 bps on Thursday.

China’s Caixin manufacturing PMI increased in February, to 50.8, from 50.1 in January.
This improvement came on the back of a surge in the new export orders component.
However, uncertainty in international policies could worsen China’s export environment in the coming months.

Eurozone inflationary pressures may have receded in February after the recent uptick.
Headline CPI for February is likely to come in at 2.3% y/y, from 2.5% y/y in January.
The ECB will keep on eye on whether services inflation moderates.

The US ISM manufacturing index for February is due out today; a slippage to 50.8 is expected, from 50.9 in January.
The ISM services index, due for release on Wednesday, is also likely to have slipped in February, to 52.7, from 52.8 in January.
The Fed’s Beige Book, scheduled for release on Wednesday, will likely highlight a surge in consumer and business sentiment.
The ADP private employment report for February is scheduled for release on Wednesday; employment is likely to have increased by 146k in February, after having increased by 183k in January.
Non-farm payrolls (NFP) for February, in the spotlight on Friday, are expected to have increased, by 160k, following an increase of 143k in January.
The unemployment rate is likely to have remained unchanged, at 4.0%, in February.

Locally, the BER manufacturing PMI for February is due for release today; the index is expected to have slipped to 45.0 in February, from 45.3 in January.
The February Naamsa vehicle sales are also due today; vehicle sales increased by 10.4% y/y in January.
GDP growth for Q4:24 is in the spotlight tomorrow and is expected at 0.8% q/q (sa), after a 0.3% q/q (sa) contraction in Q3:24.
On a y/y basis, GDP growth is expected at 1.0% in Q4:24, from 0.3% in Q3:24.
The industry-wide PMI for February is due out on Wednesday; the index is currently below the 50-benchmark, at 47.4.
The BER releases the Q1:25 business confidence data on Wednesday; the index improved to 45 in Q4:24.
The current account for Q4:24 is scheduled for release on Thursday; the deficit is expected to have narrowed to 0.9% of GDP in Q4:24, from a deficit of 1.0% of GDP in Q3:24.
Electricity production and consumption for January are scheduled for release on Thursday.
The SARB’s gross and net reserves for February are scheduled for release on Friday.
Gross reserves were $65.88bn in January, and net reserves $61.33bn.

Brent crude oil is currently at $73.16/bbl; ($73.18/bbl*).
Gold is at $2865/oz ($2857/oz*).
SA CDS 196bps*, Brazil 177bps* and Turkey 257bps*.
Yields: US 10yr at 4.20%*, German bund at 2.40%*, SA 10-year generic at 10.53%*, SA’s R2035 at 10.53%*.

* Denotes Friday’s close.

Key events and data:

11h00: SA BER manufacturing PMI (February)
11h00: Eurozone HCOB manufacturing PMI (February - final)
11h30: UK consumer credit (January), S&P Global manufacturing PMI (February – final)
12h00: Eurozone CPI (February)
16h45: US S&P Global manufacturing PMI (February – final)
17h00: US ISM manufacturing PMI (February)
SA Naamsa vehicle sales (February)

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