In the loop 04 September 2025

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is weaker this morning, at R17.72/$, after closing stronger yesterday (R17.65/$*).
EM currencies were mixed yesterday; the HUF (+0.8%), CZK (+0.6%) and KRW (+0.5%) were the biggest gainers; the RUB (-0.3%), TWD (-0.2%) and IDR (-0.1%) were the biggest losers.
Asian equity markets are mixed this morning; the Nikkei is up, while the Hang Seng and Shanghai Composite are down.

The UK’s Decision Maker Panel 3m and 1yr inflation expectations for August are due out today.
One-year ahead inflation expectations fell to 3.2% in July, from 3.3% y/y in June.
The 3-month ahead inflation expectations increased to 3.7% in July, from 3.6% in June.

Eurozone retail sales for July are due out today; sales are expected to have increased by 2.3% y/y in July, down from a 3.1% y/y increase in June.
On a m/m basis, retail sales volumes are likely to have decreased by 0.3% in July, after having increased by 0.3% m/m in June.

The latest US Fed Beige Book reported that economic activity showed “little or no change” across much of the country in recent weeks.
Consumer spending was described as flat to declining, with many households struggling as wages failed to keep pace with rising prices.
Most regions reported “modest or moderate” inflation.
Nearly all districts noted tariff-driven price increases, particularly affecting input costs.
Many firms also indicated that they expect prices to continue rising.
On the labour market, eleven districts reported little to no overall change in employment levels, while one district recorded a modest decline.

Minneapolis Fed President Neel Kashkari commented yesterday that he expects the economy to experience a gentle cooling but stressed that he is not forecasting a recession.
He added that interest rates still have some room to come down gradually.
St. Louis Fed President Alberto Musalem said he anticipates inflation will begin converging toward the Fed’s 2% target in the second half of 2026.
However, he cautioned that there remains “a reasonable possibility” of more persistent price pressures given the ongoing uncertainty around tariffs.

The US private sector ADP report for August is due out today; private payrolls are likely to have increased by 68k in August, following an increase of 104k in July.
The services PMI will likely see services activity expanding in August.
The July trade data is also on the cards today; the data will likely show the US trade deficit widened again.

Locally, electricity production and consumption for July are scheduled for release.
Electricity production, according to Stats SA, decreased by 1.3% y/y in June, after having increased by 2.3% y/y in May.
Consumption was down by 3.8% y/y in June, following a 0.3% y/y decline in May.

Brent crude oil is currently at $67.18/bbl; ($67.60/bbl*).
Gold is at $3531/oz ($3559/oz*).
SA CDS 175bps*, Brazil 138bps* and Turkey 271bps*.
Yields: US 10yr at 4.21%*, German bund at 2.74%*, SA 10-year generic at 9.73%*, SA’s R2035 at 9.63%*.

* Denotes yesterday’s close.

Key events and data:

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