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Daily Dose

Daily Dose

Good Morning,

On the wires…

  • Russia orders block on Caspian oil pipeline that could pull 1m barrels a day from Europe’s supply
  • UK’s Johnson tells ministers: No major policy changes until new leader chosen
  • Japan government confirms former PM Shinzo Abe shot, ‘condition unknown’
  • Chaos and abuse at Gordhan event as he warns of State Capture 2.0
  • Joburg man gets 8 years in jail for R1.5m lottery fraud
  • Pooran blasts West Indies to T20 series win over Bangladesh

Cartoon of the day…

The indicators…

Currency crackdown…

The dollar is little changed this morning after the EUR/USD rate set a 20-year low of 1.0144 yesterday – the pairing is actually dangerously close to setting a fresh 20-year low today. Meanwhile, the pound held its gains after Boris Johnson said he was quitting as British prime minister. The rand managed to stop it’s slip against the sterling, holding out at just under the 20.10 mark. Our ZAR did also make some ground back against the euro and the dollar, opening roughly 10 cents stronger this morning versus both major currencies. We have already given these 10 cents back to the dollar this morning, while still managing to hold the euro near the R17 point.

The market focus today will most likely be on US data releases as investors attempt to forecast the magnitude of the next interest rate hike – the dollar could be in for some volatility. The strength of non-farm payrolls, being released later today, should also point to how fast wages are rising in the US. US initial jobless claims rose last week, suggesting a cooling demand for labour as the U.S. Federal Reserve delivers tightening monetary policies. President Biden also suggested yesterday that possible US tariffs on Chinese goods will be implemented, in order to protect the US domestic industry – boosting US market sentiment. Recession fears seem to have eased slightly – as relatively optimistic speeches from Fed members Bullard and Waller yesterday suggested that the US could still avoid a recession.

Oil remains below $110, as fears that rising borrowing costs will reduce oil demand – this is still significantly higher than the price levels we saw at the start of the year, however. Copper prices recovered as investors returned to the market yesterday, after recession fears sent the red metal to its lowest level in nearly two years this week. Bitcoin made a big push last night, gaining 7.06% – we will have to wait and see if this is the beginning of a long-term resurgence.

On the radar…

  • All – Russia/Ukraine Crisis
  • EU – EU Economic Forecasts
  • EU – ECB President Lagarde Speaks
  • US – Unemployment Rate
  • US – Labour Force Participation Rate
  • US – Nonfarm Payrolls
  • US – Fed Member Williams Speaks

Did you know?

Like fingerprints, everyone’s tongue print is unique

Happy Friday 

Kyle 

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