Sign in
Research link-chevron Created with Sketch.
link-chevron Created with Sketch. Products and Services link-chevron Created with Sketch.
link-chevron Created with Sketch. Products and Services
Economics link-chevron Created with Sketch.
Equities link-chevron Created with Sketch.
Analysts
Analysts
Help and Support
Help and Support
In the loop 27 November 2024

In the loop

Shireen Darmalingam

What you should know this morning:

  • The rand is stronger this morning, at R18.16/$, after closing weaker yesterday (R18.20/$*).
  • EM currencies were mixed yesterday; the PEN (+0.3%) and KRW (+0.2%) were the biggest gainers; the MXN (-2.5%), RUB (-1.4%) and ZAR (-0.8%) were the biggest losers.
  • Asian equity markets are mixed this morning; the Nikkei and Shanghai Composite are down, while the Hang Seng is up.
 
  • Central bank watch: The Reserve Bank of New Zealand (RBNZ) cut its interest rate by 50 bps, to 4.25%.
  • The RBNZ noted that a third large cut in interest rates could be delivered early next year.
  • The Central Bank of Sri Lanka has shifted to the overnight policy rate as its benchmark interest rate, transitioning from its dual policy interest rate mechanism.
 
  • The US FOMC meeting minutes of the 6-7 November meeting highlighted that policymakers would prefer future rate cuts to be gradual.
  • Policymakers noted that if incoming data were as expected, “it would likely be appropriate to move gradually toward a more neutral stance of policy over time”.
  • The committee noted the resilience of the US economy at this meeting.
  • In addition, the FOMC also highlighted uncertainty about the neutral rate as a reason for caution, which complicated the assessment of the degree of restrictiveness of monetary policy.
  • Estimates of the neutral rate have steadily increased over the past year — but just how close rates may be to such a stance remains unclear.
  • Fed Chair Jerome Powell noted earlier in November that the US economy is not sending signals to policymakers that they would need to be hasty in lowering rates. 
  • The Fed will gather for the last FOMC meeting of this year on 17-18 December.
 
  • The US Conference Board consumer confidence index increased to 111.7 (the highest in more than a year) in November, from an upwardly revised 109.6 in October.
  • The expectations measure for the next six months also increased in November, to 92.3, from an upwardly revised 91.9 in October.
  • The present situation index increased to 140.9 in November, from 136.1 in October.
  • The improvement comes on the back of optimism about the broader economy and the labour market in the wake of Donald Trump’s re-election as president.
  • US new home sales declined significantly more than expected in October, by 17.3% m/m (to 610k annualised), after increasing by an upwardly revised 7.0% m/m in September (to 738k annualised).
  • The decline came as two hurricanes hit the south, while affordability continued to weigh on buyers.
 
  • The US Q3:24 GDP (second estimate) is expected to come in at 2.8% q/q, unchanged from the previous estimate, and from 3.0% q/q in Q2:24.
  • Personal income and spending for October are also scheduled for release today.
  • The Fed will keep an eye on the core PCE deflator, which is expected to have increased by 0.3% m/m in October, following a 0.2% m/m increase in September. 
  • Durable goods orders for October are expected to have increased by 0.5% m/m in October, following a 0.7% m/m decline in September.
  • Durable goods, excluding transportation, likely moderated slightly in October.
 
  • Locally, it’s a quiet day as far as data releases are concerned.
 
  • Brent crude is up this morning, and down by 5.4% year-to-date.
  • The gold price is up this morning, and up by 28.1% year-to-date.
 
  • Brent crude oil is currently at $72.91/bbl; ($72.81/bbl*).
  • Gold is at $2642/oz ($2625/oz*).
  • SA CDS 185bps*, Brazil 155bps* and Turkey 257bps*.
  • Yields: US 10yr at 4.30%*, German bund at 2.18%*, SA 10-year generic at 10.16%*, SA’s R2035 at 10.20%*.
 

* Denotes yesterday’s close. 

Key events and data:

  • 14h00: US MBA mortgage applications (22 November)
  • 15h30: US GDP (Q3:24), advance goods trade balance (October), durable goods orders (October), initial jobless claims (23 November)
  • 17h00: US personal income and spending (October)
 

Read PDF