In the loop 02 September 2025

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is weaker this morning, at R17.64/$, after closing stronger yesterday (R17.62/$*).
EM currencies were mixed yesterday; the HUF (+0.5%), RUB (+0.4%) and IDR (+0.4%) were the biggest gainers; the ARS (-2.3%), KRW (-0.3%) and CLP (-0.2%) were the biggest losers.
Asian equity markets are mixed this morning; Nikkei is up, while the Hang Seng and Shanghai Composite are down.

Chinese President Xi Jinping is hosting a two-day summit in China, where he has called on regional powers, including Russia and India, to join China in leveraging their economic influence to counterbalance the West.
The summit takes place amid rising geopolitical and trade tensions.
President Xi remarked that the world is undergoing a period of “turbulence and change”.
He emphasised the collective need to uphold an “orderly multi-polar world”.
He urged participating nations to expand the scope of cooperation, capitalize on each country’s unique strengths, and jointly share the responsibility of promoting regional peace, stability, and prosperity.

It’s been reported that Brazil has called for a virtual BRICS leaders meeting next Monday to address US trade policy.
President Luiz Inácio Lula da Silva is expected to raise concerns over the tariffs the US has imposed on BRICS members.
He is expected to press for stronger support of multilateralism from fellow emerging market leaders.
Brazilian officials, however, noted that the US has applied different tariff measures to each BRICS country, complicating efforts to forge a unified response.
Officials emphasised that Lula does not want the gathering to become an anti-US summit.

President Trump noted yesterday that India has offered to reduce its tariff rates after the US imposed 50% duties last week in response to India’s purchases of Russian oil.
Trump remarked that India “has now offered to cut their tariffs to nothing, but it’s getting late” — and he added that “they should have done so years ago”.
The US tariffs affect more than 55% of Indian exports to America, impacting labour-intensive sectors such as textiles and jewelry the hardest.
Key industries like electronics and pharmaceuticals remain exempt.

Eurozone inflation for August is on the cards today and is likely to have increased to 2.1% y/y in August, from 2.0% y/y in July.
On a m/m basis, CPI is expected to have increased by 0.1% m/m, after having stagnated in July.
The increase is likely on the back of higher energy prices in August.
Core CPI is expected to come in at 2.2% y/y in August, down from 2.3% y/y in July.
The ECB will meet later this month and is largely expected to keep its benchmark interest rate on hold.

The US headline ISM Manufacturing PMI for August, due out today, is expected to have improved, to 49.0, from 48.0 in July.
The services PMI, scheduled for release on Thursday, will likely see services activity expanding.

Brent crude oil is currently at $68.42/bbl; ($68.15/bbl*).
Gold is at $3494/oz ($3476/oz*).
SA CDS 175bps*, Brazil 137bps* and Turkey 264bps*.
Yields: US 10yr at 4.22%*, German bund at 2.74%*, SA 10-year generic at 9.67%*, SA’s R2035 at 9.57%*.

* Denotes yesterday’s close.

Key events and data:

Read PDF