Good morning, | |||||||||||||||||||||||||||||||||||||||||||||||||||||
On the wires… | |||||||||||||||||||||||||||||||||||||||||||||||||||||
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Quote of the day | |||||||||||||||||||||||||||||||||||||||||||||||||||||
“Compassion is not a virtue, it is a commitment. It’s not something we have or don’t have, it’s something we choose to practice.” – Brené Brown | |||||||||||||||||||||||||||||||||||||||||||||||||||||
The indicators | |||||||||||||||||||||||||||||||||||||||||||||||||||||
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Currency crackdown… | |||||||||||||||||||||||||||||||||||||||||||||||||||||
The rand traded in a very tight range for most the session yesterday. It opened less than 30c higher than this morning at R16.46/$, with the rand gaining ground for the first half of the session before spiking to hit R16.49/$ in the afternoon. This spike was short lived, as the rand clawed the losses back to close at R16.45/$ – the same level where it opened the local session this morning. Tensions in the Middle East remained high, with the SOH remaining blocked and fresh reports of the Houthis blocking Saudi Arabian oil vessels from passing through Bab al-Mandab Strait whilst enforcing their new blockade. The volume of oil going through these key shipping bottle necks for 2026 are approximately one third of the volume moved in 2023. This has caused oil to climb higher again, breaching $90 per barrel. US President Trump stated that if the Houthis enforced their blockade, the USA would answer with force. Now that they have followed through with their blockade, will we see the US engage in fresh strikes on the Iranian backed group, the day after halting strikes on Iran themselves? This has the potential to broaden the conflict in the Middle East and bring strikes to two of the three major shipping bottlenecks in the area. Despite this, equity markets have pushed on and largely ignored the escalation. US, SA, and Asian markets have all made overnight gains. Interesting to note, is that gold climbed 1.6% to hit $4,142 an ounce. This was its highest level in over two weeks, largely attributed to market participants buying the dip. Other precious metals also gained across the board, with silver climbing 2% – good signs for South Africa. Local inflation figures and retail sales will be released later this afternoon, which will give a further indication as to how the SARB will approach their next MPC meeting and interest rate decision. The US will also release their crude oil inventory figures and this evening, President Trump will be speaking. These releases alongside the tensions in the ME could result in some choppy waters. Keep a close eye on them throughout the day as they will dictate the rand’s movements. | |||||||||||||||||||||||||||||||||||||||||||||||||||||
On the radar… | |||||||||||||||||||||||||||||||||||||||||||||||||||||
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Did you know? | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Sheep have rectangular pupils.
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Have a great day
Luke Rosenberg
