Daily Market Report 16 Sep
Big week for central banks
Several central banks will be announcing their monetary policy decisions this week. The Fed will be first on Wednesday, with markets split between a 25bps and 50bps cut, the BOE and the SARB are next on Thursday with the BOE expected to keep rates unchanged while the SARB is expected to cut by 25bps. On Friday, we have the Bank of Japan decision, with markets expecting rates to be kept on hold but with a hawkish outlook. The Dollar has started the new week on a softer note as bets on a jumbo 50bps rate cut grow. The DXY index is down at 100.84 with the Euro hovering just below 1.1100, the Pound up at 1.3151, while the Yen is at 140.20. The Yen briefly broke below the 140.00 mark earlier today in thin Asian markets with Chinese, Japanese, and Korean markets closed for holidays today. News of an apparent second assassination attempt on Donald Trump has not had much impact on currency markets but did send Gold to a fresh record high. The Rand has opened on a firmer note this morning in line with a softer Dollar and generally stronger EM markets. The Rand currently sits at R17.70 after having closed at R17.75 on Friday. A break below the R17.65 level could see the local currency firm further but we have struggled get through this level at previous attempts.
Gold hits a new record high
The softer Dollar and reports of a second assassination attempt on Donald Trump pushed Gold to a new record high of $2,589.23 this morning. Demand for Gold is likely to remain high due to safe-haven demand and on rowing bets of a larger Fed rate cut. Platinum and Palladium are both firmer at $1,002 and $1,077 respectively. Brent crude has opened unchanged at $71.61 this morning as rate cut expectations are offset by ongoing demand concerns and weak Chinese economic data.
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