FX DAILY REPORT – 24 October 2024
- The Rand opened significantly weaker against all the major currencies this morning.
- South African CPI inflation decreased significantly to 3.8% growth (YoY) from previous months 4.4%. This is the lowest level we have seen in over three years. This has reaffirmed expectations of another interest rate cut next month for South Africa. Additionally, carry trades are starting to look less appealing to investors as SARB is projected to continue cutting rates for the next year and a half.
- The USD strengthened yesterday as investors have moved their focus to the US and are eagerly awaiting the presidential election outcomes. A Trump victory will likely strengthen the USD as his policy plans are pro-US economic growth. A Harris victory will likely weaken the USD as her policy plans will likely be a continuation of President Bidens. Trump is currently priced in to take the win.
Todays Events:
- BRICS Summit (Tuesday – Thursday)
- HCOB Eurozone Manufacturing PMI at 10:00 – Expected to be 45.1 from previous 45.0. A higher-than-expected result can be seen as positive for the EUR.
- S&P Global/CIPS UK Manufacturing PMI at 10:30 – Expected to remain the same at 51.5. A higher-than-expected result can be seen as positive for the GBP.
- US Initial Jobless Claims at 14:30 – Expected to be 243K from previous 241K. A higher-than-expected result can be seen as negative for the USD.
- S&P Global US Manufacturing PMI at 15:45 – Expected to be 47.5 from previous 47.3. A higher-than-expected result can be seen as positive for the USD.