Rand update

Some very poor economic data out of China saw EM markets weaken to the Far East this morning, with the rand taking the biggest hit. Chinese retail sales for April fell by 11.1% vs. estimates of a 6.1% drop, while industrial production dropped by 2.9% vs. estimates of a 1.4% increase. The Covid-driven lockdowns also saw Chinese unemployment rise to 6.7% in April.

The rand, which had closed at R16.15 on Friday, weakened to R16.27 levels this morning on the back of the Chinese data but has managed to recover some of the losses and is currently quoted at R16.22. The R16.30 level has been tested on five occasions now and is still holding.

Commodity update

Gold and Platinum both closed softer on Friday, while Palladium ended 1.9% stronger. We start the new week with Gold slightly softer at $1,807, but Platinum and Palladium are both trading firmer at $941 and $1,955, respectively. The price of Oil has fallen this morning, with both Brent and WTI down 2.0% at $109.50 and $108.60, respectively.

International update

There was a pause in the dollar’s advance on Friday, and we saw both the euro and pound end marginally higher. Global geopolitical tensions and global growth concerns are underpinning the dollar as Sweden, and Finland’s NATO plans have seen Russia threaten retaliation.

The DXY index is sitting at 104.59 this morning, with the dollar trading at 1.0406 against the euro and at 1.2246 against the pound. US Treasury yields ended a touch higher on Friday, while Wall Street had a strong close to the week. The S&P was 2.39% stronger, the Nasdaq climbed by 3.82%, and the Dow was 1.47% higher. US futures, along with Asian markets, have started the new week in negative territory.

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